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Stocks Beginner: Types of Stock

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1.
Which of the following stocks performs well during a market downturn?
Choose wisely. There is only one correct answer.
Defensive. During downturns, some companies do well because their services are needed at all phases of the business cycle.
2.
Why would a value investor watch for changes in operations at a corporation?
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Changes in operations may drive up the company's stock price. The value investor looks for growth in a stock's price.
3.
What stock market indicator is made of blue chip stocks?
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The Dow Jones Industrial Average. This average is made of 30 blue chip stocks.
4.
The stock of which of the following companies probably does not qualify as income stock?
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An Internet company. Internet companies are too new for their stocks to qualify as income stock.
5.
Why do growth stocks pay little by way of dividends?
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The issuing company reinvests profits to finance future growth. This is a common practice among rapidly growing companies.