19. The Stock Market Flashcards
What is the purpose of selling shares?
Raise capital for their business
What is Market Capitalisation?
The value of all shares issued by a company
What is the stock market?
A place and platform for individuals, firms and governments to buy and sell shares.
What is Consumer Confidence?
An ‘economic indicator’that measures how much optimism consumers have regarding the overall state of a country’s economy and their own financial situations.
What can the stock market do?
Create business and consumer confidence
Why is the stock market important?
A vital source of economic information
What are the functions of the stock market?
Raising share capital through selling shares on the market
Facilitate the growth of businesses
Sell government bonds
Provide a safe space for transaction
What is a Preferred stock?
Holders of this type of stock will receive profits before other shareholders
What is Common stock?
Normal stock. Dividends are paid to holders of these shares after the preference shares have gotten theirs.
Each stock owned translates to one vote in the business
What are Government Bonds?
Loan stocks issued by the Government to borrow money over a fixed period of time and are repaid with interest at the end of the period.
How do some people buy shares?
Via a broker
