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MM Investing: Stocks Flashcards | StudBud
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MM Investing: Stocks
MM Investing: Stocks
55 terms
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Stocks
Flashcards
55 cards
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Questions
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Answers
1
If you purchase a stock and sell it off within a year, you are considered an investor.
False
True
2
The CEO of the corporation decides whether or not to pay out dividends on the stocks
True
False
3
All of the following are locations for regional exchanges EXCEPT
San Francisco
Boston
Denver
Chicago
4
A small-cap stock company has more than $500 million in total amount of stocks and bonds issued
True
False
5
All of the following are characteristics of blue-chip stock companies EXCEPT
Consistency in payment of dividends
Higher than average dividends
Leader in an industry
History of stable earnings
6
A company whose stocks are traded in the open market.
Private corporation
Public corporation
Sole proprietorship
Partnership
7
All of the following are activities of growth stock companies EXCEPT
Paying out higher than average dividends
Building new facilities
Introducing new, high quality products
conducting research and development
8
A private corporations stocks are sold in the open market.
True
False
9
Which numerical calculation is the difference between the selling price and the purchase price
P/E Ration
Capital Gain
Current Yield
Total Return
10
Preferred stock is a safer investment than bonds.
True
False
11
All of the following are ways that preferred stock is offered to attract investors EXCEPT
Convertible Preferred
Cumulative Preferred
Participation Feature
Conservative Preferred
12
Your profit from the sale of stock is the price you sell it at minus the price you bought it at
False
True
13
People buy stock because it is a more secure investment than savings and government bonds.
False
True
14
When investors are optimistic about the economy
growth market
economic market
bull market
bear market
15
Shareholders have rights, including a vote per share owned at the required annual meeting
True
False
16
Which numerical measure divides the annual dividend by the current market value
Earnings per Share
Total Return
P/E Ratio
Current Yield
17
Combined, NASDAQ and the NYSE have _________ corporations to invest in
3800
2100
5900
4900
18
Which is not a way that shareholders make money from their stock investment?
The stock splits
Profit from dividends
The dollar value of the stock increases
Profit from retained earnings
19
When using brokerages, the biggest difference in the way you purchase stock is the commission
False
True
20
Common stock has a higher growth potential than preferred stock.
True
False
21
The P/E ratio of a healthy company should land somewhere between 5 and 35, the lower the better
True
False
22
Penny stock prices are stable and typically sell for under $10 per share
False
True
23
A stock's market value will go up after a stock split.
False
True
24
Which of the following would be considered a cyclical stock company?
Ford
Proctor and Gamble
Johnson and Johnson
Twitter
25
Most dividends are paid out every 3 months.
True
False
26
Utility companies are usually found to be ________ stock companies.
income
penny
cyclical
growth
27
Which numerical calculation is the annual dividend added to any change from the purchase price
Capital Gain
Current Yield
P/E Ratio
Total Return
28
A long-term investment is held for at least 5 years.
True
False
29
How do investors make money on their stock investment?
Through selling to investor and dividends
By getting dividends from the company
By selling the stock to investors
By selling the stock to the company
30
A market order is a request to buy or sell a stock at a specific price.
True
False
31
________ stock companies usually do not pay out dividends.
growth
cyclical
penny
income
32
AT&T and Kelloggs are considered
Growth stocks
Income stocks
Blue-chip stocks
Cyclical stock
33
The price of a stock is determined by the seller.
False
True
34
Buyers of preferred stock are also interested in _______ stock companies.
cyclical
income
penny
growth
35
Like Market Value, the Par Value for a stock changes over time.
True
False
36
A defensive stock company would be
Proctor and Gamble
Ford
GM
Royal Caribbean
37
The type of stock that is the most reactionary to economic fluctuation.
income
defensive
growth
cyclical
38
Dividends received by preferred stockholders are a specific amount of money or a percentage of
Face Value
Par Value
Profit
Market Value
39
IPO's are considered a safe investment.
True
False
40
Stocks listed in the Dow Jones typically have a market capitalization of $500 mil or more
True
False
41
A stock split is an indicator that the company's finances are in trouble.
False
True
42
Companies that are growing quickly will pay out large dividends to their stockholders.
False
True
43
Current shareholders have the _______ right to buy any new issue of stock before the public
convertible
participation
preemptive
conversion
44
An IPO can be done in either the primary or secondary markets.
False
True
45
If you have 120 shares of stock at $75, and it splits three-to-one, you will own
240 shares at $25
360 shares at $50
360 shares at $25
240 shares at $50
46
The total amount of stocks and bonds issues by a corporation is its
consideration
capital gain
current yield
capitalization
47
Corporations have to repay the money that a shareholder pays for stock.
False
True
48
Which measure is the price of one share of stock divided by the earnings per share over a year
Total Return
P/E Ratio
Earnings per Share
Current Yield
49
The CEO makes all of the major decisions for the corporation.
False
True
50
The goal of the investor is to purchase cyclical stock while the economy is in good shape.
True
False
51
All of the following are types of orders used to trade stock EXCEPT
Market order
Stock order
Stop order
Limit order
52
Dividends are paid out by a corporation in all of the following way EXCEPT
Cash
Bonds
Stocks
Products
53
Which numerical measure is the after-tax income divided by the number of outstanding shares
Earnings per Share
P/E Ratio
Total Return
Current Yield
54
When investors are pessimistic about the economy
bear market
economic market
declining market
bull market
55
If a company has a slow growth year, they must still pay out dividends.
False
True