UK Clinical Aptitude Test (UKCAT) Practice Test

Which statement is true regarding shares in a company?

1. They can only be owned by corporate members

2. Investors can buy and sell them publicly

3. They guarantee a fixed percentage of profit

4. They are only relevant to private companies

The correct answer is: Investors can buy and sell them publicly

The statement regarding shares in a company that is true is that investors can buy and sell them publicly. Shares represent ownership in a company and can be traded on various stock exchanges, allowing for public buying and selling. This liquidity is a key feature of publicly traded companies, where shares are accessible to a broad range of investors, not just corporate members or private entities. Ownership of shares is not restricted to corporate members, as individuals and institutions can also own shares. Shares do not guarantee a fixed percentage of profit; instead, dividends (if declared) depend on the company’s profitability and are not uniform. Moreover, shares are relevant to both private and public companies, as private companies also issue shares, typically on a smaller scale and with different trading constraints than public companies.