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Jillette.Stocks.Quiz
Questions to help you prepare for next Friday's quiz.
Question | Answer |
---|---|
What is a stock? | Part ownership in a company. |
What are the two ways you can make money on a stock? | 1. Selling for more than you paid. 2.Dividends |
What is a dividend? | The company pays a percentage of its' earnings to the shareholders, as a thank you for owning stock. |
What is a ticker symbol? | The abbreviation for the company, how it is listed on the stock market. |
What does the 52 week range tell you about a stock? | The highest and lowest prices the stock has been in the past year. |
What are the 3 reasons the stock market has struggled lately? | 1. China's economy 2. The Fed raising interest rates 3. Cheap oil |
What is the difference between a private company and a public company? | Private companies are not traded on the stock market, they are owned by a family or small group of investors. Public companies are traded on the stock market. |
If you sell stocks for less than what you paid for it, you experienced a __________. | loss |
What is P/E? | Price/Earnings |
What does P/E tell you about a stock? | The amount of growth people expect a company to make in the next year. |
What is the average P/E? | Between 15-25 |
What does it mean if the P/E is higher than 25? | People expect the company to make higher than average growth. |
What does it mean if the P/E is less than 15? | People don't expect the company to grow much. |
When should you use the P/E to help make investment decisions? | When you are comparing stocks within the same industry. |
Explain why the P/E for one company could be lower, but the current price per share is still higher (Ex: Pepsi and Coke) | There are more things that go into the current price per share, like their advertisements, product variety, whether they pay dividends. |