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16 Jan 2018

STOCK MARKET- SHARE TIPS+ INDIAN ECONOMY Q&A.

Hi Friends,   The two strongest emotions operating in the stock market are greed and fear. Greed is the dominant emotion in a booming market.  It makes individuals grasp and grab when they buy shares.  There is often a mad scramble to get on to the stock market bandwagon during a boom.  Share prices skyrocket to levels which lose all touch with reality.  On the other hand, fear takes over in a falling market.  Share prices nosedive and panic selling starts as investors and speculators scramble to get out before the prices fall further.  It is greed and fear that lead to excesses of over valuation and under valuation of shares in the stock market.  The rational investor takes advantage of these market over-reactions to make profits.  He buys when the shares are underpriced and sells when they are overpriced.  The more irrational the market, the greater the opportunities for the cool, objective, rational investor.  In short, an irrational market is a rational investor’s dream come true.    Conversely, a rational, orderly and logical stock market is a rational investor’s nightmare.  In such a market, opportunities to make profits would dry up.  Price and value would always match.  There would be no gross excess in the overvaluation and undervaluation of share prices.  In short, there would be no scope for making big profits.


Good Luck.                                                                  See You Later. 



Q. GNP is equal to
1. Total output of goods and services in one year
2. Total output minus intermediate consumption
3. Total output minus savings
4. Total output plus total factor payment
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Ans: 2
Q. The budget deficit refers to the difference between all revenue and expenditure of
1. Revenue account only
2. Capital account only
3. Both revenue and capital accounts
4. Increased government expenditure
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Ans: 3
Q. Economic planning refers to
1. the mobilisation of taxes
2. the acquisition of taxes
3. the allocation of resources
4. the planning of resources
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Ans: 3
Q. From which of the following items India export the most?
1. Textile goods
2. Jute
3. IT Services
4. Gems and Jewellery
View answer
Ans: 4
Q. Indian government is planning to introduce GAAR. What is the purpose of GAAR?
1. Increase rural income
2. Increase agriculture income
3. Regulatory authority for managing agriculture resources
4. Curtail tax avoidance
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Ans: 4
Q. CPI and WPI as acronyms, refer to -
1. Political Parties
2. Purchasing capacity indices
3. Price indices
4. Poverty indices
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Ans: 3
Q. Which of these bodies decides the monetary policy in India?
1. Reserve Bank of India
2. Ministry of Finance
3. Ministry of Commerce
4. Ministry of Finance and Commerce
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Ans: 1
Q. When prices of goods increase, purchasing power of money -
1. Fluctuates
2. Decreases
3. Increase
4. Remains constant
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Ans: 2
Q. Micro economics deal with -
1. Total units
2. Individual units
3. Partial units
4. Marginal units
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Ans: 2
Q. Perfectly inelastic demand of a commodity means,
1. the cost of a commodity changes but the demand remains unchanged
2. the price of the commodity does not change with the change in its demand
3. the demand of a commodity does not change with the change in its price
4. the demand of some other commodity changes with the change in the price of one commodity.
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Ans: 3
                      

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