Stocks Beginner: Introduction to Stocks

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1.
Corporate stock represents _______.
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Net assets. Stock represents a share of ownership in a companys assets.
2.
A _______ broker helps customers make decisions on investments.
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Full-service. The full-service broker includes investment assistance in his or her range of services.
3.
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.
4.
Common stock and preferred stock both convey the same kind of equity rights.
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False. Owners of preferred stock have prior claim to the companys assets over owners of common stock.
5.
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.