The Role Of Shareholders

Question 1

Who are shareholders?

Answer 1

Anyone who owns at least one share in a company.

Question 2

Who buy shares in a LTD?

Answer 2

Family and friends

Question 3

Who buys shares in a PLC?

Answer 3

Individuals and companies

Question 4

For companies, What is the main role of shareholders?

Answer 4

To provide funds.

Question 5

What is an AGM?

Answer 5

Annual General Meeting

Question 6

What is an AGM?

Answer 6

Shareholders vote on key decisions and performance of the company

Question 7

What is it called if a shareholder owns more than 50%?

Answer 7

Majority Shareholder

Question 8

What liability do shareholders have?

Answer 8

Limited

Question 9

Why do shareholders invest in businesses? 3 reasons

Answer 9

Achieve a capital gain
Dividends
For aims and objectives

Question 10

How do LTDs have control over their share price?

Answer 10

Shares are privately traded between friends and family

Question 11

How are shares in a PLC sold?

Answer 11

Stock market

Question 12

What does good performance of the company do to demand and supply?

Answer 12

Good performance means an increase in demand and increase in share price.

Question 13

What does bad performance of the company do to demand and supply?

Answer 13

If a company reports low profits, shareholders may sell their shares increasing supply and reduce share price.

Question 14

What does speculation and rumour of new product launches influence demand and supply?

Answer 14

Share price goes up

Question 15

How does share price influence demand and supply?

Answer 15

If share price is low - investors may buy now. Increases demand
If share price is high - shareholders may decide to sell their shares

Question 16

How can state of economy influence demand and supply?

Answer 16

If economy is strong, people have more money to invest and confidence. Increases demand and share price.
If economy is weak, people are less likely to invest. Decreases demand and share price.