What is a stock? How do stocks affect the economy? What will be an id

What is a stock? How do stocks affect the economy?

What will be an ideal response?

ANSWER

A stock represents a share of ownership of a corporation, or a claim on a firm’s earnings/assets. Stocks are part of wealth, and changes in their value affect people’s willingness to spend. Changes in stock prices affect a firm’s ability to raise funds, and thus their investment.