18 Questions
What is the main reason a company divides itself into multiple shares?
To raise funds from multiple investors instead of a few
If a company divides itself into 1 crore shares, what fraction of the total company value does each share represent?
1/10,000,000 of the total company value
Which of the following is NOT a reason a company might have thousands or even lakhs/crores of shares?
To increase the complexity of the company's ownership structure
If a company has divided itself into 100 shares, what percentage of the total company value does each share represent?
1%
Which of the following is NOT a likely reason an individual investor might own a large chunk of a company's shares (e.g. in the lakhs)?
They want to make the company more complex
Which of the following is the most accurate description of how a company's shares are typically divided and sold?
The company divides itself into thousands or millions of small shares and sells them to many individual investors
What does the market capitalization of a company essentially mean?
The total value of the company's shares outstanding
Which of the following is a characteristic of large-cap companies?
They have a market capitalization of more than $10 billion
How do stock indices like SENSEX and NIFTY represent the overall health of the stock market?
They include a basket of stocks that represent the largest companies in India
Which of the following is a characteristic of small-cap companies?
They have a market capitalization of less than $2 billion
Which of the following is a characteristic of mid-cap companies?
They are typically more stable and less risky investments
What is the key difference between investing in individual stocks and investing in a stock index?
Investing in individual stocks allows you to capitalize on the performance of a single company, while investing in a stock index provides exposure to a broader market
What is the market capitalization range for large-cap companies?
Greater than Rs. 1,000 crores
Which of the following is an example of a mid-cap company?
TCI Express
What is the market capitalization range for small-cap companies?
Less than Rs. 1,000 crores
Which of the following statements about small-cap companies is true?
They have a relatively higher risk and lower liquidity compared to large-cap companies.
Which of the following is an example of a large-cap company?
Reliance Industries
What is the primary factor used to categorize companies as large-cap, mid-cap, or small-cap?
Market capitalization
Learn about shares in stock investing. Understand how a share represents ownership in a company by dividing it into smaller parts that are sold to multiple individuals.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
