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Stock Exchange Vision Statement Quiz

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Questions and Answers

What is the purpose of a stock certificate?

It represents the stockholder's ownership in the company (correct)
It is used to buy and sell stocks on the stock market
It is a document that records stock dividends
It determines the value of a company's stocks

What is the primary role of a stockbroker?

To determine the value of a company's stocks
To distribute stock dividends to stockholders
To issue stock certificates to stockholders
To facilitate the buying and selling of stocks and shares (correct)

What is the primary reason why individuals or companies buy stocks?

To receive stock certificates as collector's items
To obtain profit through dividends or capital gains (correct)
To gain control over the company's operations
To earn interest income like from a bank deposit

What is the difference between a stock dividend and a cash dividend?

A stock dividend is a distribution of additional shares, while a cash dividend is a monetary payment (B) Signup and view all the answers

What is the purpose of a stock market?

To facilitate the buying and selling of stocks and shares (B) Signup and view all the answers

What is the primary component of stockholder's equity?

The ownership interest of stockholders in the corporation (C) Signup and view all the answers

What is the purpose of issuing new shares of stock to the public?

To obtain long-term financial capital for the company (A) Signup and view all the answers

What is the primary difference between equity capital and debt capital?

Equity capital represents ownership, while debt capital is a loan (A) Signup and view all the answers

What is the primary function of a stock exchange?

To facilitate the buying and selling of stocks and shares (C) Signup and view all the answers

What is the primary reason why a company would issue a stock dividend?

To distribute profits to stockholders without using cash (A) Signup and view all the answers