The impact of COVID-19 on US stock market was:

The stock market dropped significantly

What is a stock dividend?

Part of a company's profit that is paid to owners

What is an employee stock option?

A right to buy company stock at a specified price for a fixed term.

What is a bullish stock market?

Prices on average are rising over time.

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Topic 6 Equity

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Questions 16

Answers

1
All of the following are advantages of a corporation except:
freely transferableownership.
low management costs.
access to capitalmarkets.
limited liability.
2
A share of the profits paid by a company to it's ordinary shareholders is known as?
Shared Profit
Percentage Return
Profit Reward
Dividends
3
Compared with ordinary shares, preference shares usually:
rank ahead of a company's creditors in the case of awind-up.
are viewed as debtfinancing.
pay their dividends after ordinary shares.
have dividends set at issue.
4
Stock Market is where investors
Buying Stocks
Buying and Selling Stocks
Buying A Stock
Buying and Selling Socks
5
The impact of COVID-19 on US stock market was:
The stock market remained the same
The stock market dropped significantly
The stock market rose significantly
The stock market shut down
6
Why do people buy stock?
Just because
To invest
To spend money
To raise moeny
7
Convertible preference shares are normally converted into:
Shares
Bonds
Warrants
Debentures
8
A right that can only be exercised by the shareholder and not sold is called a:
pro rata right
Non-saleable right
renounceable right
non-renounceable right
9
A company may raise additional equity capital through:
a dividend reinvestment scheme
All of the given answers
a rights issue.
a placement
10
What is a stock dividend?
The price for which the stock is sold in stock markets
A capital gain
The price for which the stock is sold to investment bankers
Part of a company's profit that is paid to owners
11
What is an employee stock option?
A grant of company stock as a salary bonus.
A right to buy company stock at a specified price for a fixed term.
An option to be paid in stock instead of cash.
A right to buy company stock at a guaranteed discount for a fixed term.
12
Which of the following forms of business organisation is characterised by limited liability?
Sole partnership
Partnership
Corporation
General partnership
13
Why do companies choose to issue stock?
To determine the supply and demand of stock
To calculate dividend yield
Just because
To raise money
14
Where is stock bought and sold?
Stock exchange
Stock market
From a stock broker
Brokerage house
15
What is a bullish stock market?
When the speculation maintains the share price index.
When the market equilibrium does not change.
Prices are generally falling over time.
Prices on average are rising over time.
16
If a company raises equity funds by issuing shares to a selected number of institutional investors, this is known as:
a placement.
a share rights issue.
share transfer.
a share appointment.

Topic 6 Equity Flashcards | StudBud