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1.
Technical analysts rely heavily on company balance sheets to predict price movements.
False. Technical analysts do not use any fundamental company information, such as balance sheets, to make their predictions.
2.
Security analysis is the process of _______.
Researching and evaluating the factors that influence a securitys value. Using ratios is one part of this analysis, and getting the best possible prices for stocks is one of its many goals.
3.
An upward trend that shows a reversal pattern will _______.
Go down. An upward trend that shows a reversal pattern will go down.
4.
A high debt-to-equity ratio is an indicator of low risk.
False. A high debt-to-equity ratio is an indicator of high risk. It means the company is carrying a lot of debt relative to equity.
5.
A _______ chart is used to track a stock's price momentum.
Point. A point chart is used to track a stock's price momentum.
6.
The main information source for fundamental analysis is the cash flow statement.
False. The main information source for fundamental analysis is the balance sheet.
7.
Fundamental analysts use a corporation's financial information to determine its stock's intrinsic value.
True. Fundamental analysts are concerned with the state of the company.