JA Stock Market Lesson 2 Quiz

Who typically makes recommendations about a company's stock price during its initial public offering (IPO)?

• Stockbroker

• Accountant

• Lawyer

• Marketing Manager

Who sets the initial price of each share of stock when a corporation goes public?

• The company's CEO

• The stockbroker

• The board of directors

• The underwriter

During a company's IPO, who can buy its stock?

• Only the company's employees

• The general public

• Only institutional investors

• Only private investors

How is the price of a company's stock during the IPO different from when it is traded on a stock exchange?

• It is more volatile

• It is fixed

• It is negotiable

• It is discounted

Who can be a public investor?

• The company itself

• Financial institutions

• Any public investor

• An investment bank

What is governed by supply and demand?

• Financial health

• Stock price

• An investment bank

• A new CEO

Who can negotiate stock prices?

• Only financial institutions

• An investment bank

• The company itself

• Non-negotiable

Who is responsible for the financial health and prospects of a company?

• The company itself

• Any public investor

• An investment bank

• A new CEO

What does revenue growth measure?

• The increase or decrease in a company's sales over time

• The total profit a company makes in a year

• The number of new customers acquired

• The amount of money spent on marketing

How is the price-to-earnings (P/E) ratio calculated?

• By dividing a company's total revenue by its total expenses

• By dividing a company's current stock price by its earnings per share

• By multiplying a company's stock price by its earnings per share

• By subtracting a company's liabilities from its assets