Capital Market Lesson3

What is a key function of stock exchanges in the financial market?

• Ensuring companies always increase their stock prices

• Providing a marketplace for buying and selling stocks, bonds, and derivatives

• Granting loans to companies for expansion

• Regulating interest rates on bonds

Which of the following is NOT a key function of stock exchanges?

• Issuing new shares directly to investors

• Price discovery based on supply and demand

• Providing liquidity for securities

• Ensuring transparency in trading information

Which of the following stock exchanges is known for being the first electronic stock market?

• NYSE

• NASDAQ

• LSE

• Tokyo Stock Exchange

What are "blue-chip" companies?

• Companies that are startups with high growth potential.

• Large, well-established, and financially stable companies with a long history of reliable performance.

• Small companies that are new to the stock exchange and offer high-risk, high-reward opportunities.

• Companies that primarily operate in the technology sector.

What type of companies are typically listed on the NASDAQ exchange?

• Industrial and blue-chip companies

• Government-owned corporations

• Technology and growth-oriented companies

• Only financial institutions

What differentiates the NASDAQ from the NYSE?

• NASDAQ is an auction market, while NYSE is a dealer market

• NYSE specializes in technology stocks, while NASDAQ lists blue-chip companies

• NASDAQ operates as a dealer market, while NYSE operates as an auction market

• Both are dealer markets with similar listing requirements

Which index tracks the largest companies listed on U.S. exchanges?

• FTSE 100

• Dow Jones Industrial Average (DJIA)

• S&P 500

• NASDAQ Composite

What is the key feature of the Dow Jones Industrial Average (DJIA)?

• It is market-cap weighted, favoring larger companies

• It tracks 100 of the largest companies in the U.S.

• It is price-weighted, giving more influence to higher-priced stocks

• It only includes technology stocks

Which of the following is the benchmark index of the Philippine Stock Exchange?

• Nikkei 225

• PSEi

• FTSE 100

• Hang Seng Index