Make a list of 5 products that you think are great and will be money makers for the company that produces them. Try to guess what company makes the product.

 The Kraft Heinz Company  What other brands do they own? 

Definitions Brand Name – The popular name of a product. Parent Company – A business that owns and controls another company. Subsidiary – A business that owned by another company. What other companies you know that own other companies?

 rer rer 

 Fill in the chart on my website with the following  Brand Name  Company Name  Parent of subsidiary of what company  If your brands turn out to have the same company name pick another brand.

Definitions Opportunity Cost – The second best alternative of a choice. This is the opportunity given up by making a particular choice. (opportunity given up) Scarcity – The fact that limited means, such as time or money cannot satisfy all of everyone’s wants.

Ownership of shares in a business

 When you buy a stock you become part owner of a public company – no matter how many shares you own.  If the stock price exceeds what you paid for it, your investment increases in value.  If the stock price goes lower than what you paid for it, your investment decreases in value.  You risk ONLY the money you invest.

 If a company’s product or service is in great demand, demand may exceed the ability of banks and venture capitalist (who privately supply funding) to provide money for the company’s expansion to meet that demand. At that point company leaders may decide to “go public.”

 Private companies shares are not for sale the general public.  Mars Corp, the snack food giant, is privately held.  Google, was privately held until 2005, when it went public, offering its stock for sale.

 Company management go to investment bankers to negotiate an agreement to underwrite (back, guarantee, finance) a stock offering know as an IPO.  The investment bankers buy all the shares that will be offered to the public at a set price (primary market).  In other words, they underwrite the IPO. The investment bankers then sell the stock to the general public (secondary market) in the hopes of making a profit.  In addition to finding underwriters, company management must register its stock with the Securities and Exchange Commission (SEC).  company/ company/

 Dividends are payments made by a company to its shareholders.  When a company earns a profit, that money can be put to two uses: it can either be re- invested in the business, or it can be paid to the shareholders as a dividend. Many corporations retain a portion of their earnings and pay the remainder as a dividend.

 Companies can offer two types of stock, Common and Preferred.

 Most basic form of ownership  One vote per share owned to determine company’s board of directors  Ways the stock value can change  The dollar value increases or decreases  Stock split occurs – shares owned by existing stockholders are divided into a larger number of shares  A merger of two companies  Dividends are paid ..

 Preferred stock – shares which pay fixed dividends and have priority over common stock  Less risk than common stock  No voting rights  Dividends are stated as a percentage known as the par value Fixed value stated on the stock certificate

 An important difference between common stock and preferred stock is that the price of the preferred stock tends to be more stable, changing little over time, than that of common stock.  Preferred stock is less risky than common stock, therefore investors can expect less reward.

 New York Stock Exchange (NYSE)  ew-york-stock-exchange-nyse/ ew-york-stock-exchange-nyse/  Parent Company EuroNext (german)  National Association of Securities Dealers Automated Quotation (NASDAQ)  aq.asp aq.asp

 Located along Wall Street in Manhattan  It caters to well-established companies like IBM, Ford, and McDonald’s.  To be listed, a company must have at least 1.1 million shares of stock outstanding, pre-tax profits of $10 million, and have a global market of a least $750 million.

 The Dow Jones (“The Dow”) (NYSE)  Gauges the performance of the industrial sector of the American Stock Market. The average consists of 30 of the largest and most widely held public companies in the United States.

 Standard & Poor's 500 (S & P 500) (NYSE)  Gauges the performance of 500 Large Corporations, all of which are from the United States.