Question

Which of the following statements about stock markets is/are correct?

1)    Stock markets provide a platform for companies to raise funds through the sale of stocks to investors.

2)    The price of a stock on a stock exchange is determined by the supply and demand for the stock.

3)    Stocks are ownership claims on the business.

A 1 and 2 only Correct Answer Incorrect Answer
B 1 and 3 only Correct Answer Incorrect Answer
C 2 and 3 only Correct Answer Incorrect Answer
D 1, 2 and 3 Correct Answer Incorrect Answer
E 3 only Correct Answer Incorrect Answer

Solution

Statement 1 is correct as stock markets provide a platform for companies to raise funds through the sale of stocks to investors. Statement 2 is also correct as the price of a stock on a stock exchange is determined by the supply and demand for the stock.

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