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Stock Market

Stock Market Test

40 Questions

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Stock Market
Stock Market 


1. What is the stock market?

A A type of farmers market where people buy and sell food.

B A place where parts of businesses are bought and sold.

C A special type of grocery store that sells stocks.

D A type of bank that gives out loans to new businesses.


2. The name for a part of a business that is bought and sold on the stock market is:

A Part B Marker

C Share D Stocker


3. Why would a company need to issue stock?

A To stop the government from regulating it. B To show customers that it's successful.

C To raise money. D To increase its' customer base.


4. When you own stock in a company,

A you are involved in day to day management.

B you are the CEO.

C you are part owner. D you are entitled to a dividend.


5. IPO stands for

A Initial Primary Offering B Imminent Profitable Option

C Itemized Public Organization D Initial Public Offering


6. 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 provides a snapshot of how the stock market and the US economy is doing.

C It tells Americans how much debt the country is in.

D It helps economists predict when a stock market crash will happen.


7. The current price of one share of stock is called

A Open B Ask

C Bid D Last


8. The highest price the stock has traded over the past year is called

A Market Cap Market Cap

B 52 Week High

C Beta D Day High


9. The number of shares that have been traded in the current or most recent trading session is called

A Volume B Dividend

C Last Last

D Previous Close


10. A company owned by families or a small number of investors and do not issue stock to the public.

A private company B portfolio

C public company D industry


11. People who own stocks are guaranteed a return on the money they have invested in stocks.

A FALSE B TRUE


12.

The possibility of losing some or all of a particiular investment.

A index B industry

C profit D risk


13.

A sum of money paid to shareholders of a corporation out of its earnings.

A index B dividend

C invest D profit


14.

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


15. Not all companies offer dividends.

A false B true


16. A corporation “goes public” when it ___________________.

A has a big party and invites all its investors. B becomes an entity.

C gives out its first dividend. D first issues stock to investors to buy.


17. The NYSE and NASDAQ are forms of ________________ where people trade stocks.

A businesses B mutual funds

C large shopping centers D stock exchanges


18. Explain what an IPO is.

A It's when a company goes 'public' and offers its stock for sale for the first time.

B It's when another company buys a lot of stock in another company to take it over.

C It's when a company buys back a lot of its stock to gain control of the company.


19. How do you make money buying stocks?

A If you hold on to it as long as possible it will gain in value.

B The DOW ratings determine which stocks will pay out.

C You sell it for a higher price than you bought it for.


20. As long as you are 18 years old and have some money, you can invest it in the stock market.

A False B True


21. If a business wants to raise capital but not create debt, it can

A borrow money from a commercial bank B issue common stock

C float a bond issue D borrow money from the government


22. A Neon Oil Corporation tanker spilled oil in the ocean around Australia. As a result of this accident, the share price of this stock is likely to

A increase

B not be affected and remain about the same

C fluctuate D decrease


23. Which of the following best describes diversification?

A reducing risk by investing in different types of securities

B Avoiding risk by investing in blue-chip stocks

C investing in different types of bonds

D putting all your investments in two financial investments


24. The group of stocks that you own is called a

A portfolio B dividend

C commission


25. A time when stock prices are RISING is called

A transaction B bear market

C bull market


26. When the market takes a downhill turn and prices are decreasing

A Bear B No such term

C Bronco D Bull


27. The Dow Jones Industrial Average is an example of

A A Stock Market Performance Index B a Stock Market Exchange

C a Mutual Fund D a Brokerage Firm


28. What is the name of the most well know stock exchange?

A The New York Stock Exchange (NYSE) B The Louvre

C The Imperial Stock Exchange D The Boston Stock Exchange


29. An index that measures the average health of 30 large, publicly owned, US companies is called the...?

A Bob Johnson's Index B Guess Again Index

C The S&P 500 D Dow Jones Industrial Average (DJIA)


30. Which of the following is NOT a stock index?

A P/E RATIO B NASDAQ COMPOSITE

C DOW JONES D S & P 500


31. Can interest rates affect the stock market?

A NO B YES


32. Do more or fewer people invest in the stock market when interest rates go up?

A FEWER B MORE


33. Not having all your stocks in one industry (airlines, food, etc) is called

A Portfolio B Trading

C Directing D Diversifying


34. What are the two general types of stocks? CHOOSE TWO

A Deferred B Common

C Preferred D Certificate of Deposit


35. The two major stock exchanges are

A NASDAQ & NYSE B Dow Jones Industrial Average & S&P 500

C NYSE & American D NASDAQ & DJIA


36. What is a bond?

A an investment that cannot be traded

B lending money to a company for a fixed interest payment

C a share of ownership in a company D a building on wall street


37.

What is a stock market crash?

A when one or two stocks drop signifiicantly

B rapid and unanticipated drop in stock prices

C rapid but anticipated drop in stock prices D slow decrease in stock prices over a year


38.

A stock market crash can be brought on by

A major catastrophic event B economic crisis

C collapse of a stock bubble D all of these


39. What does NASDAQ stand for?

A National Application of Securities Dealers Automatic Quotations

B Nominal Association of Securities Dealers Automatic Quotations

C New Association of Securities Dealers Automatic Quotations

D National Association of Securities Dealers Automatic Quotations


40. How does a bear stock market impact the U.S. economy?

A Americans will invest more money in the stock market.

B Consumers will purchase more vacation homes.

C Americans will invest less money in the stock market.

D Consumers will purchase more large appliances.


Answer Key

1. b 2. c 3. c 4. c

5. d 6. b 7. d 8. b

9. a 10. a 11. a 12. d

13. b 14. b 15. b 16. d

17. d 18. a 19. c 20. b

21. b 22. d 23. a 24. a

25. c 26. a 27. a 28. a

29. d 30. a 31. b 32. a

33. d 34. 35. a 36. b

37. b 38. d 39. d 40. c

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