Types of Stocks Quiz
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Questions and Answers

What type of stock earns profits above the average profits of all firms in the economy?

  • Growth stocks (correct)
  • Blue chip stock
  • Cyclical stock
  • Income stock
  • Which stock pays higher than average dividends from a steady source of income?

  • Growth stocks
  • Blue chip stock
  • Cyclical stock
  • Income stock (correct)
  • Which type of stock follows the business cycle of advances and declines in the economy?

  • Growth stocks
  • Cyclical stock (correct)
  • Blue chip stock
  • Defensive stock
  • Which stock remains stable during declines in the economy and has a history of stable earnings?

    <p>Defensive stock</p> Signup and view all the answers

    What financial activity involves transactions in property such as stocks, bonds, commodities, and currency?

    <p>Investment</p> Signup and view all the answers

    What is the market in which outstanding securities are bought and sold by owners other than the issuers?

    <p>Secondary market</p> Signup and view all the answers

    Which measure of variability is equal to the square root of the variance?

    <p>Standard deviation</p> Signup and view all the answers

    What is the estimation of future security price movements based on past price and volume movements called?

    <p>Technical analysis</p> Signup and view all the answers

    What is the professional management of various securities and assets in order to meet specified investment goals called?

    <p>Portfolio management</p> Signup and view all the answers

    What is the probability of not achieving the forecast return often referred to as?

    <p>Risk</p> Signup and view all the answers

    Which type of stock generally attracts conservative investors?

    <p>Blue chip stock</p> Signup and view all the answers

    Study Notes

    Stock Types

    • Superior stock: earns profits above the average profits of all firms in the economy
    • Income stock: pays higher than average dividends from a steady source of income

    Market and Economy

    • Cyclical stock: follows the business cycle of advances and declines in the economy
    • Defensive stock: remains stable during declines in the economy and has a history of stable earnings

    Financial Activities

    • Investing: involves transactions in property such as stocks, bonds, commodities, and currency
    • Secondary market: the market in which outstanding securities are bought and sold by owners other than the issuers

    Measures and Analysis

    • Standard deviation: a measure of variability equal to the square root of the variance
    • Technical analysis: the estimation of future security price movements based on past price and volume movements

    Investment Management

    • Portfolio management: the professional management of various securities and assets in order to meet specified investment goals
    • Risk: the probability of not achieving the forecast return

    Investor Profiles

    • Conservative investors: generally attracted to defensive stocks

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    Description

    Test your knowledge on different types of stocks by identifying blue chip, income, growth, and cyclical stocks based on their characteristics and behaviours in the economy.

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