1. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. CHAPTER 17 The Stock Market

2. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. The Value of Outstanding Shares of Domestically Issued Stock since 1982 (End of Year) *Through second quarter 2001. SOURCE: Flow of Funds of the United States, Z1, Board of Governors of the Federal Reserve System, various issues. 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001* Year $1,562.5 1,856.0 1,789.2 2,270.4 2,682.6 2,710.3 3,076.3 3,819.7 3,542.6 4,863.4 5,430.9 6,306.2 6,333.3 8,495.7 10,255.8 13,201.3 15,427.8 19,576.3 17,168.8 15,863.3* Corporate Equities

3. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. The Returns to Stocks and Bonds over Time A rETURN TO STOCKS IS MEASURED BY THE Standard and Poor’s 500 Composite Index and includes reinvestment of dividends. b Return to bonds is measured by Moody’s AAA Rated Corporate Bond Index and includes reinvestment of interest. c Through September 28, 2001. SOURCE: Global Financial Data, Los Angeles, California. Value of $100 invested in bonds in 1969 b Value of $100 invested in stocks in 1969 a 1970197519801985199019952000 2001 c Year $5,000 4,000 3,000 2,000 1,000 0

4. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. Net Non-U.S. Purchases of U.S. Stocks U.S. Dollars, in Billions *Annualized through second quarter 2001. SOURCE: Flow of Funds of the United States, Z1, Board of the Federal Reserve System, September 18, 2001, page 22. 200 150 120 100 80 60 40 20 0 '95'96'97'98'99'00'01* 11.2 42.0 67.8 112.3 11.1 193.8 151.0

5. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. The Ten Largest Companies (Measure by Market Value) Traded on the Big Board, July 2001 Ten Largest NYSE-Listed Companies JULY 2001 Company Name General Electric Co. Exxon Mobil Corp. Pfizer Inc Citigroup Inc Wal-Mart Stores American International Group AOL Time Warner Inc Intl Business Machines Corp Johnson & Johnson Merck& Co Symbol Ge XOM PFE C WMT AIG AOL IBM JNJ MRK Market Cap ($bil.) 432.2 288.1 260.2 252.7 249.9 194.1 193.6 182.8 163.8 155.9 NYSE Average Daily Volume 20,876540 10,958,637 13,242,718 11,257,568 7,428,327 4,849,423 13,078,036 7,748,647 8,183,296 6,710,387 Market Cap ($bil.) 506.9 278.2 165.9 237.6 244.9 203.8 117.4 202.9 129.3 167.0 SOURCE: http://www.NYSE.com.

6. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. The Companies that Make Up the Dow as of August 31, 2001 Alcoa American Express AT&T Boeing Caterpillar Citigroup Inc. Coca-Cola DuPont Eastman Kodak Exxon Mobil Corp. General Electric Co. General Motors Corp. Hewlett-Packard Co. Home Depot Honeywell International Inc. IBM Intel Corp. International Paper J. P. Morgan Chase & Co. Johnson & Johnson McDonald’s Corp. Merck & Co. Microsoft Corp. Minn. Mining & Manufacturing Philip Morris Cos. Procter & Gamble Co. SBC Communications United Technologies Corp. Wal-Mart Walt Disney

7. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. The Value of the DJIA, S&P 500, NYSE Composite, and NASDAQ since 1985 Stock Market Indices (End of Period) 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001* 1,546.67 1,895.95 1,938.83 2,168.57 2,753.20 2,633.66 3,168.83 3,301.11 3,754.09 3,834.44 5,117.12 6,448.27 7,908.25 9,181.43 11,497.12 10,786.90 9,323.54 Dow Jones Industrial Average 211.28 242.17 247.08 277.72 353.40 330.22 417.09 435.71 466.45 459.27 615.93 740.74 970.43 1,229.23 1,469.25 1,320.28 1,087.22 S&P 500 121.58 138.58 138.23 156.26 195.04 180.49 229.44 240.21 259.08 250.94 329.51 392.30 511.19 595.81 650.30 656.87 557.60 NYSE Composite 324.93 348.83 330.47 381.38 454.82 373.84 586.34 676.95 776.80 751.96 1,052.13 1,291.03 1,570.35 2,192.69 4,069.31 2,470.52 1,745.73 NASDAQ Composite As of November 2, 2001. SOURCE: Global Financial Data, Los Angeles, California

8. Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. Daily Average of Stock Market Volume and Values Traded since 1985 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000* 109.2 141.0 188.9 161.5 165.5 156.8 178.9 202.3 264.5 291.4 346.1 412.0 526.9 673.6 808.9 953.8 NYSE 8.3 11.8 13.9 9.9 12.4 13.2 133.3 14.2 181.1 17.9 20.1 22.1 24.4 28.9 32.7 37.1 AMEX 82.1 113.6 149.8 122.8 133.1 131.9 163.3 190.8 263.0 295.1 401.4 543.7 647.8 801.7 1,081.8 1,542.0 NASDAQ 3.9 5.4 7.4 5.4 6.1 5.2 6.0 6.9 9.0 9.7 12.2 16.0 22.8 29.0 35.5 40.0 NYSE 0.9 1.5 2.0 1.4 1.7 1.8 2.7 3.5 5.3 5.8 9.5 13.0 17.7 22.9 43.7 79.7 NASDAQ As of July 2001. SOURCE: Securities Industry Association Stock Market Volume (Daily Avg., Mils. of Shs.) Value Traded (Daily Avg., $ Bils.)