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Stocks Beginner: Introduction to Stocks

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1.
Which of the following statements is true?
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Bonds pay fixed income; common stock doesnt. Bonds pay a fixed interest rate; stock values and dividends depend on the performance of the company.
2.
The best way to make a lot of money quickly is to buy and sell blue chip stocks.
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False. Blue chip stocks have low volatility, so any growth in value is likely to be slow.
3.
A customer who wants nothing more than execution of trades from his or her broker will want a _______ broker.
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Deep-discount. The deep-discount broker limits his or her services to execution of trades.
4.
Jim just bought 200 shares of Microsoft. He is now part owner of ______.
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All of the above. These are all examples of the companys assets. Stock ownership conveys equity in a companys assets.
5.
Common stock is less predictable than preferred stock.
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True. Since preferred stock pays a fixed premium, it is more predictable than common stock.