Stocks Beginner:
Introduction to Stocks
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1.
A customer who wants nothing more than execution of trades from his or her broker will want a _______ broker.
Choose wisely. There is only one correct answer.
Discount
Deep-discount
Full-service
Deep-discount. The deep-discount broker limits his or her services to execution of trades.
2.
Common stock is less predictable than preferred stock.
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True
False
True. Since preferred stock pays a fixed premium, it is more predictable than common stock.
3.
Common stock and preferred stock both convey the same kind of equity rights.
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True
False
False. Owners of preferred stock have prior claim to the companys assets over owners of common stock.
4.
Corporate stock represents _______.
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Debts
Net assets
Loans
Management
Net assets. Stock represents a share of ownership in a companys assets.
5.
The best way to make a lot of money quickly is to buy and sell blue chip stocks.
Choose wisely. There is only one correct answer.
True
False
False. Blue chip stocks have low volatility, so any growth in value is likely to be slow.
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DONE