STOCK MARKET PART 2

Introduction to the Stock Market

48 Questions
NAME :
DATE :

1. EPS x (times) Shares Outstanding = a company’s total ________
A Profits B Sales
C Dividends D Market Capitalization

2. In a 2-for-1 stock split, the price of the stock is
A doubles B falling
C cut in half D not affected

3. What is a bond?
A a building on wall street
B lending money to a company for a fixed interest payment
C an investment that cannot be traded
D a share of ownership in a company

4. A dividend is a portion of the company’s profits paid to its shareholders.
A True B False

5. What is an IPO?
A when a company first sells stock to the public
B a new Apple product
C when the company’s shareholders have a meeting
D when the government creates shares on the stock exchange

6. For a company to exist for the long term what must it continue to do?
A Provide for customers B Produce a product or a service
C Make a profit D Help the economy to grow

7. interest calculated at regular intervals solely on principal
A Simple Interest B Compound Interest
8. What is a mutual fund?
A a fund that follows an index like a stock B a type of high interest bank account
C a pool of securities you can buy as an investment
D a fund used by companies to raise capital

9. The last closing price of a stock divided by the last 12 months earning per share is
A Dividend Yield B Debt to Asset Ratio
C Earnings /Share D P/E

10. The price paid for the first share of stock in a trading session is
A Last B Bid
C Open D Change

11. Mutual funds are:
A usually less risky than investing in a money market
B an investment that holds a wide range of different investment instruments, providing diversification
C guaranteed to increase in value
D an investment portfolio managed by the investor

12.
A $13.31 B $1.24
C $1.95 D $0.90

13. Which of the following is your right as a shareholder of common stock?
A the right to dividends if paid B the right to hire officers of the corporation

14. What are 2 ways you can make money in stock market
A Use all of your money to buy stocks
B Do research and invest in stocks that do well
C be aware somebody will make you do that D Buy what everyone else is buying

15. If a company issues dividends, preferred stock holders are paid the dividends first.
A True B False

16. Typically, stocks are a good invest for the average person over a long period of time.
A True B False

17. A _____ is a list of the securities, including stocks, mutual funds, and cash that you own.
A folder B notebook
C collection D Portfolio

18. What does EPS stand for?
A Earnings People’s Share B Earnings Per Share
C Earnings Price Share D Earnings Profit Share

19. In short selling, you first ___ the stock.
A buy B split
C hold D sell

20. _____ stock is the name applied to the stock of large, well-known, well-established companies
with good reputations.
A Dip and chip B Paint chip
C Chocolate chip D Blue chip

21. What is a another word for earnings?
A Dividends B Profits
C Stocks D Shares

22. What is Capitol gain?
A The gain of money a Capitol city gets B Short selling
C The amount a company gets that year D The increase in the value of the stock

23. What is the goal of an investor?
A Buy low and sell high B Keep a stock for their entire life
C Open a new investment account D Help a company get bigger

24. What is the Bull market
A When the stock market trends downward B This is when the bull owns the market
C The place where you buy bulls for bull fights
D When the stock market trends upward

25. Publicly held corporations
A are listed first on the New York Stock Exchange
B guarantee a positive return to investors
C are not-for-profit organizations
D have shares of stock that are held by public (outside) investors

26. Why should an investor diversify?
A promises growth in your investments B lets customers spend more
C gives a company more options D spreads the risk taken by a shareholder

27. Dividends
A The money a company makes each year
B The part of the corporations profit paid to stockholders
C How much money the owner makes
D The answer could be any one of these have fun

28. What is the primary reason why companies issue stocks?
A To ensure a stable market B To raise extra money for the company
C To guarantee the success of a new product
D To provide for their employee’s retirements

29.
A $ 0.62 B $ 2.50
C $ 1.95 D $ 0.55

30. What is Leverage?
A The average growth of a stock each year B A rise in the general level of prices
C Prying open a door with a crowbar
D The use of borrowed money to buy securities

31. What is a Bear Market?
A when the stock market trends upward B answer the question see if you are correct
C When the stock market trends Downward D A place where you sell bears downtown

32. Yield of the stock based on last price. Figured by dividing the yearly dividend by the last price.
A Change B Dividend
C Dividend Yield D Previous Close

33. What is Common Stock
A Stock that the common people buy B leaves of corn that look alike
C variable dividend but no voting rights
D A type of stock that pays a variable dividend. Gives holder voting rights

34. What are preferred stocks
A Stocks that most people prefer
B A type of stock that pays a fixed dividend and carries no voting rights
C Stocks that make millions

35. People who invest in the stock market will automatically make money.
A False B True

36. What are stock shares?
A Certificate showing a company’s income
B Certificate showing a company’s retirement system
C Certificate showing a company’s dividends
D Certificate showing partial ownership of a company

37. Shares Outstanding x Last Trade = _________
A Sales B Profits
C Market Capitalization D Earnings

38. Common stock is more prone to rapid changes; therefore, there is more risk associated.
A True B False

39. Publicly held corporations
A are not-for-profit organizations
B have shares of stock that are held by public (outside) investors
C are listed first on the New York Stock Exchange
D guarantee a positive return to investors

40. What does a stock represent?
A a contract for a company’s goods and services
B a percentage of ownership of a company
C a loan you make to a company D stocks are just tools used to make money

41. What is NASDAQ?
A Certificates certifying you own a stock
B What stocks are called when they are bought and sold
C The biggest stock market in the world D An automated system for trading stocks

42. How do people make money investing in bonds?
A Selling a bond for more than you paid B Give them $100
C Take the money from the bond people D James Bond

43. The NYSE is an exchange where daily auctions (the biding of stocks) determine the price for thousands of different stocks.
A False B True

44.
What is a stock?
A A person who buys things for you
B A document that represents ownership in a company
C A document that states you are worth a lot of money
D A part of a share of showing profit in a company

45.
Does Home Depot pay a dividend? See quote behind the questions.
A Yes B No

46. If a bond is held to maturity, the investor will receive an amount stated on the bond known
as the _______.
A face value B maturation value
C printed value D ticket value

47. Stocks are a share of ownership in a company and a person who owns one or more shares of stock is called a …
A Broker B Dividend
C Securities D Stock Holder

48.
National Association of Securities Dealers Automated Quotations, or NASDAQ,
A uses stockbrokers in conjunction with the Dow to make trades
B uses a computer automated system for trading
C uses ebay to help make the trades D uses the same trading system as the NYSE.

Answer Key
1. a 2. c 3. b 4. a
5. a 6. c 7. a 8. c
9. d 10. c 11. b 12. d
13. a 14. b 15. a 16. a
17. d 18. b 19. d 20. d
21. b 22. d 23. a 24. d
25. d 26. d 27. b 28. b
29. b 30. d 31. c 32. c
33. d 34. b 35. a 36. d
37. c 38. a 39. b 40. b
41. d 42. a 43. b 44. b
45. a 46. a 47. d 48. b

Stock Market

Part 1
30 Questions
NAME :
DATE :

1. As long as you are 18 years old and have some money, you can invest it in the stock market.
A False B True

2.
Represents shares of ownership in a company.
A stock B industry
C portfolio D volume

3. A system in which individuals are free to own, trade, and use things in order to make a profit
A bear market B capitalism
C stock exchange D bull market

4. A time when stock prices are RISING is called
A transaction B bear market
C bull market

5.
A company’s profit or earnings divided equally among all the shares investors own.
A market capitalization B industry
C volume D earnings per share

6. Stocks represent ownership in a corporation.
A FALSE B TRUE

7. The DOW Jones Industrial Average is an index of 30 American companies. Why is the DOW Jones Industrial Average important?
A It tells Americans how much debt the country is in. B It tells Americans how many jobs are out there.
C It provides a snapshot of how the stock market and the US economy is doing.
D It helps economists predict when a stock market crash will happen.

8. A company owned by families or a small number of investors and do not issue stock to the public.
A public company B private company
C portfolio D industry

9.
The total number of shares traded in a given day.
A profit B beta
C loss D volume

10. A person who is licensed to buy and sell stock
A investor B shareholder
C stockbroker

11.
To put money to use by purchasing something offering potential profitable returns as interest, income, or appreciation in value.
A index B stock
C portfolio D invest

12. Why would a company need to issue stock?
A To show customers that it’s successful. B To stop the government from regulating it.
C To increase its’ customer base. D To raise money.

13.
A sum of money paid to shareholders of a corporation out of its earnings.
A index B invest
C dividend D profit

14.
Groups of companies that are related based on their primary products or services.
A public company B stock
C index D industry

15. Over the course of the day, the head of Apple’s company is imprisoned for not paying his taxes. What do you think will happen to Apple’s stock?
A It will go up. B It will go down.

16. Apple is releasing a new iPhone that is predicted to change the cell phone world. Millions of people have pre-ordered it.
What do you think will happen to their stock?
A It is likely to go up. B It is likely to go down.

17.
The total holdings of stock by a financial institution or a private investor.
A index B portfolio
C industry D stock market

18. A time when stock prices are falling
A transaction B bull market
C bear market

19.
A company that sells stock on the stock market.
A public company B market capitalization
C private company D stock market

20.
The highest price and lowest price of a stock over a 52 week period.
A volume B 52 week range
C profit D beta

21. to buy a variety of stocks
A diversify B risk
C portfolio D profit

22. You have $250 that you are willing to invest in Apple’s stock. If Apple’s stock is selling for $113.05 a share, how many shares could you buy?
A 2 B 4
C 3 D 1

23.
When assets or stocks are sold for a price lower than the original purchase price.
A volume B loss
C profit D risk

24.
The financial benefit when the revenue of a company exceeds expenses, costs, and taxes.
A loss B profit
C volume D portfolio

25.
The possibility of losing some or all of a particiular investment.
A industry B index
C risk D profit

26.
A holder or owner of stock in a company or corporation.
A shareholder B portfolio
C stock market D industry

27. One way stockholders make money is by selling their stock for more money than they paid for it.
A TRUE B FALSE

28.
A group of large companies that stockbrokers look at to gauge how the market is doing as
a whole.
A portfolio B index
C shareholder D industry

29. People who own stocks are guaranteed a return on the money they have invested in stocks.
A FALSE B TRUE

30.
A particular market where stocks and bonds are traded.
A market capitalization B stock market
C shareholder D portfolio

Answer Key
1. b 2. a 3. b 4. c
5. d 6. b 7. c 8. b
9. d 10. c 11. d 12. d
13. c 14. d 15. b 16. a
17. b 18. c 19. a 20. b
21. a 22. a 23. b 24. b
25. c 26. a 27. a 28. b
29. a 30. b

Part 2

20 Questions
NAME :
DATE :

1. What is a stock broker?
A A machine that keeps track of the prices of stocks B Anyone who owns stock
C Someone who loses all of his/her money after making bad investments
D Someone who is licensed to buy and sell stock on a stock exchange

2. What is the primary reason for a company to issue stock?
A To raise money to grow the company B To increase greater awareness of the company
C To distribute the risk of bankruptcy across more investors
D The stocks help investors earn a higher rate of return

3. It is free to buy stocks
A False B True

4. A strong market when prices are going up.
A Diversification B Bull Market
C Bear Market D Equities

5. A company owned by families or a small number of investors and do not issue stock to the public.
A industry B portfolio
C public company D private company

6. Common stock ownership gives investors
A guaranteed dividends B voting rights in shareholder meetings
C lower risk with a higher rate of return

7. Ownership in a corporation; represents a claim on part of the corporation’s assets and earnings.
A stocks B Mutual funds
C bonds

8. What is it called when the stock market rises for a period of time?
A stock market B growth market
C bear market D bull market

9. The DOW Jones Industrial Average is an index of 30 American companies. Why is the DOW Jones Industrial Average important?
A It tells Americans how many jobs are out there. B It tells Americans how much debt the country is in.
C It provides a snapshot of how the stock market and the US economy is doing.
D It helps economists predict when a stock market crash will happen.

10. A group of thirty stocks that measure the performance of the stock market and mainly focuses on one market.
A Dow Jones Industrial Average B Standard and Poors 500
C National Association of Securities Dealers Automated Quotation
D New York Stock Exchange

11.
A sum of money paid to shareholders of a corporation out of its earnings.
A dividend B index
C profit D invest

12. People who own stocks are guaranteed a return on the money they have invested in stocks.
A FALSE B TRUE

13. Who regulates stock market exchanges?
A Christian Garcia B New York stock exchange
C securities and exchange commission D congress

14. The two major stock exchanges are
A NYSE & American B NASDAQ & DJIA
C Dow Jones Industrial Average & S&P 500 D NASDAQ & NYSE

15.
The total holdings of stock by a financial institution or a private investor.
A stock market B industry
C portfolio D index

16. Which type of shareholder gets dividends first?
A Common stock B Treasury stock
C Preferred stock

17. You loan money to a corporation or government, and they pay you back with interest
A Stock B Mutual Funds
C Bonds

18. People who own stocks are guaranteed a return on the money they have invested in stocks.
A FALSE B TRUE

19. A poor market when prices are going down.
A Diversification B Bull Market
C Equities D Bear Market

20.
A company that sells stock on the stock market.
A private company B stock market
C market capitalization D public company

Answer Key
1. d 2. a 3. a 4. b
5. d 6. b 7. a 8. d
9. c 10. a 11. a 12. a
13. c 14. d 15. c 16. c
17. c 18. a 19. d 20. d

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