When people are financially literate, they have the knowledge and information necessary to make sound financial decisions. The 2020 TIAA Institute-Global Financial Literacy Excellence Center Personal Finance Index reported that more than half of U.S. adults understood borrowing, saving, earning and consuming, while less than half had a clear understanding of investing and risk.
One common type of investment is stock. The stock market is where stock is issued, purchased and sold. Stockholders have an ownership interest in a company. Test your knowledge of stocks by taking this brief quiz.
- What is a characteristic of a bull market?
- Stock prices rise
- Stock prices fall
- Investors are pessimistic
- None of the above
- A stockholder is ______ who/that owns at least one share of a corporation’s stock.
- A person
- A company
- An institution
- All of the above
- A person may be able to invest in a company by purchasing:
- Common stock\
- Preferred stock
- Corporate bonds
- All of the above
- What term is used to describe a stock market decline of 10 percent?
- A dip
- A correction
- A haircut
- A bath
- List the following from highest risk to lowest risk:
- Emerging market stock
- 10-year Treasury bond
- 30-year investment-grade bond
- Savings account
- S. blue chip stock
- Which of the following is a reason that a company might issue stock?
- Raise capital
- Transfer ownership
- Reduce debt
- All of the above
If you have any questions about the answers, let us know.
Photo by: Stock Market © Tnsdesign | Dreamstime.com
Answers: (1) A; (2) D; (3) D; (4) B; (5) A, E, C, B, D; (6) D