1. Chapter 7 - Economics – Stocks and Bonds
Corporations sell stock in their corporations to consumers.
 Stockholders/ Shareholders – people who buy stock in a corporation. They are part owners of the corporation.

2. Stock’s (Cont’d.)
In turn, the corporation uses this money to help their business grow.
Profits made by the business are distributed to stockholders/shareholder. These are called dividends.

3. There are two types of stock that people can buy:
Stocks (Cont’d)
There are two types of stock that people can buy:
Preferred Stock – you receive a stated dividend each year.
i. Do not get to vote at annual company meetings.
Common Stock – Do not receive a stated dividend every year. If the company has enough money at the end of the year, they may pay Common Stockholders a dividend.
Are allowed to vote at annual company meetings.

4. Buying and Selling Stock
A way to make money with stocks is through buying and selling individual stocks.
When you buy stock in a corporation, you are said to be making an investment in the corporation.
Investment – using money to earn interest or income, in the hopes of making a profit.