Question

What was the danger of stock speculation?

A. Too few people would want to buy stocks on margin.

B. Stockbrokers who sold stocks would not make money.

C. Stock prices would decline and investors would lose money.

D. Too few people would invest money in stocks.

Answer 1

it will be C. Stock prices would decline and investors would lose money.

Answer 2

The correct answer is: C) Stock prices would decline and investors would lose money.

Stock speculation consists of investing on a stock before the rest of the market does and thus having the opportunity to generate greater returns than what one could have with non-speculative stock but at a much higher risk, turning into something like gambling. This is why it is quite dangerous to engage in stock speculation.