What is a defining characteristic of blue-chip stocks? Option: They are exclusively found in the technology sector., They represent companies with a strong financial track record., They are highly speculative investments., They are primarily issued by startups.

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What is a defining characteristic of blue-chip stocks?

They are exclusively found in the technology sector.

They represent companies with a strong financial track record.

They are highly speculative investments.

They are primarily issued by startups.

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What are blue-chip stocks primarily known for in the stock market?

Unpredictable returns and high risk

Association with small, emerging companies

High volatility and frequent price swings

Stability and consistent dividend payments

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What is a defining characteristic of companies that issue blue-chip stocks?

They are highly regarded in the market with a proven track record of financial stability

They primarily operate in niche markets with limited competition

They have a small market capitalization and limited financial resources

They are newly established businesses with limited market history

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Which term describes a company with a long history of financial stability and consistent dividend payments?

Blue-Chip Stock

Penny Stock

Growth Stock

Emerging Market Stock

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What is a potential drawback of investing in blue-chip stocks?

They tend to have a high growth rate, leading to rapid price fluctuations

They offer high dividend yields, making them unsuitable for income-focused investors

They may have a slow growth rate, requiring patience to see substantial returns

They are relatively inexpensive, making them accessible to all types of investors

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What is the general investment horizon associated with blue-chip stocks?

Medium-term, around 3 to 5 years

Short-term, typically less than a year

Long-term, usually over 7 years

Variable, depending on market fluctuations