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1.
Technical analysts rely heavily on company balance sheets to predict price movements.
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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 _______.
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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 _______.
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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.
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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.
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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.
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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.
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True. Fundamental analysts are concerned with the state of the company.