objectives discuss investment activities that promote economic growth explain borrowing activities...
TRANSCRIPT
Objectives
Discuss investment activities that promote economic growth
Explain borrowing activities by government. Businesses and consumers
Describe future concerns of economic growth
Essential Question – how does the government borrow money?
Investment Activities
How are you making an investment right now?– You are investing in your future right now by
being in school
– Companies invest all the time by buying buildings and equipment
Capital Spending
Capital Spending refers to money spent by a business for an item that will be used over a long period.
Capital projectsInvolve spending by businesses for items such as land, buildings and equipment and new products.
Where does the moola come from for all these capital projects!???!?
Personal Savings
Stock investments
Bonds
Personal savings….not much else to explain
What are some forms of personal savings?
The Stock Market
-Corporations are a major type of business org.
-Businesses can’t come up with all the money on their own so people invest in them
Stock Represents ownership in a corporation
David Choe – graffiti artist
Multi-millionaire overnight!
Was given the choice for $60,000 or stock to spray paint the walls of Facebook’s office.
He chose stock – now worth more than $200,000,000!
Painting Video
Walters Interview
What causes the value of stocks to change?
Affected by many factors, but the main one is SUPPLY and DEMAND– If a company has higher earnings, more people
will DEMAND it’s stock and want to buy it
– Causes the value of stock to increase
The Bond Market
Another investment activity involves the sales of bonds.
If you purchase a bond, you are a creditor…it means you lent money to the organization
bondA bond represents debt for an organization.
Government Debt
If a surplus exists, government may reduce taxes or increase spending on various programs
Budget surplusWhen the government spends LESS than it takes in.
Government Debt
Budget deficitWhen the government spends MORE than it takes in.
This happens more often
Government Debt
National debtThe total amount owed by the federal government
www.usdebtclock.org