THE GREAT DEPRESSION 1929 1940
THE GREAT DEPRESSION
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
people wanted to buy them because they were on sale!
|
|
|
people lost a lot of $$
|
|
|
Either A or B
|
|
|
None of the above
|
Detailed explanation-1: -When a share’s price decreases in value, that change in value is not redistributed among any parties – the value of the company simply shrinks. The stock market is governed by the forces of supply and demand.
Detailed explanation-2: -Sometimes, however, the economy turns or an asset bubble pops-in which case, markets crash. Investors who experience a crash can lose money if they sell their positions, instead of waiting it out for a rise. Those who have purchased stock on margin may be forced to liquidate at a loss due to margin calls.
Detailed explanation-3: -The value of the stock itself can’t go negative. It can only become zero is the company goes bankrupt. The only case when you can see negative result is if you bought the stock and the price declined.
Detailed explanation-4: -Yes, you can lose any amount of money invested in stocks. A company can lose all its value, which will likely translate into a declining stock price. Stock prices also fluctuate depending on the supply and demand of the stock. If a stock drops to zero, you can lose all the money you’ve invested.