Market Mechanics Quiz

1 point(s)

What is the effect of an increase in demand for a security with a constant supply?

Prices tend to drop

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Prices tend to rise

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No effect on prices

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Prices fluctuate randomly

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1 point(s)

What is the role of ‘market makers’ in financial markets?

Predicting market trends

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Providing liquidity to the markets

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Regulating stock exchanges

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Setting interest rates

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1 point(s)

Which phase in the Boom and Bust Cycle is characterized by high investor confidence and economic growth?

Boom Phase

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Bust Phase

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Recession Phase

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Stagnation Phase

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1 point(s)

Range-bound markets are characterized by a lack of a clear trend in either direction.

True

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False

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1 point(s)

An uptrend in technical analysis is identified by a pattern of lower highs and lower lows.

True

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False

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3 point(s)

Match the following market concepts with their descriptions.

Sort elements

Area where sellers enter the market causing price drop
Area where buyers enter the market pushing the price up
Point where quantity supplied equals quantity demanded

Supply Zone

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Demand Zone

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Market Equilibrium

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3 point(s)

Connect these market mechanics to their definitions.

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General direction of price movement of an asset
Periods where price oscillates between high and low
Phases of bullish and bearish trends in the market

Trends

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Ranges

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Market Cycles

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1 point(s)

Arrange these market participants based on their potential influence on market prices, from least to most: Individual Investors, Institutional Investors, Market Makers.

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1 point(s)

Rank these events based on their typical occurrence in the Boom and Bust Cycle, starting with the boom: Economic Expansion, Fiscal Intervention, Economic Slowdown, Decrease in Investor Confidence.

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1 point(s)

How might understanding market supply and demand dynamics influence your investment strategies?

This response will be awarded full points automatically, but it will be reviewed and possibly adjusted after submission.