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Name ___________________________________ Financial Literacy “The Language of the Stock Market” Worksheet – Part 1 Directions: Complete while viewing “The Language of the Stock Market – Part 1” PowerPoint presentation. 1. The _________________ ___________________ is the core of America’s economic system. 2. ________________ is a share of _________________ in the assets and earnings of a _______________. 3. A ________________ is a type of ________________ a company issues to investors for a specified amount of time. 4. Two reasons companies like to issue stock: a. Company does not have to ____________ the money. b. Paying _______________ is optional. 5. Dividends are _____________________ of earnings paid to ___________________________. 6. What is the relationship between risk and return? Higher __________ of return 7. = greater __________ Two types of stock: a. b. 8. Common Stock: a. Most basic form of ______________________ b. One ____________ per share owned determines company’s board of ________________ 9. Ways that common stock value changes: a. Dollar value __________________ or ___________________ b. ____________________ ____________________ occurs — shares owned are divided into larger number of shares (for example, 1 share becomes 2 shares) c. A ___________________ of two companies d. __________________ are paid 10. Preferred Stock: a. Pay fixed dividends and have __________________ over common stock b. _____________ risk / no ___________________ rights c. Dividends are a percentage of the __________ value of the stock 11. Seven basic stock classifications: a. e. b. f. c. g. d. 12. Growth Stock: New companies ____________________ product lines a. Usually do not pay _________________ b. Beta is ___________ or higher c. Two examples: ______________________ ______________________ 13. Income Stock: Company retains small portion of ____________________ a. Steady stream of _________________ such as ____________________ companies b. Beta less than _____________ 14. Value Stock: Have a ___________ market price considering historical ____________________ records and value of __________________. a. Viewed as investment ____________________. b. Previous examples: ___________________ _____________________ 15. Cyclical Stock: Influenced by changes in ____________________ business cycle. a. Companies in major ______________________ _____________________ industries b. Examples: ___________________ _____________________ ____________________ c. Beta is generally ______________ 16. Countercyclical Stock: Products are always in __________________ a. Good for investors who want ____________________ b. Examples: ______________________ _________________________ c. Beta is ______________ or below, even negative 17. Speculative Stock: Very high-_____________ stocks a. Examples: ____________________ ________________________ b. Beta is ______________ 18. Blue Chip Stock: Nationally-recognized companies with long record of _______________, _____________ payments, and a good reputation of ____________________. a. Less _______________ b. Grow at a _______________________ rate c. Examples: ______________________ _____________________ ___________________