[tadita83]

I may be asking in the wrong section, but here it goes.

I am about to teach the Great Depression and I always like to give an explanation of how the stock market works. I hate teaching the stock market because I feel like I don't have ALL the understanding of it myself at least not as well as I understand other topics. I am making a handout and I was hoping someone could look over it and tell me what I'm missing or what I am completely off on. Thanks in advace

How the Stock Market Works
1. Companies sell stock (ownership in their company) to investors. When a person buys a stock he/she is literally buying part of the company. The money the investor puts in is used to run the company and in return the investor gets a portion of the profits of that company.

2. If there are 100 shares of a company available and you buy 20 shares, you now own 20% of the company and therefore will receive 20% of the profits of that company.

3. If a company is successful and is receiving high profits then you may choose to hold onto the stock and continue to receive your portion of the profits. You may also choose to sell that stock to someone else while the price is still high.

4. If the company is successful then people will be willing to pay much more for the stock than for stock in a company that is only average or below.

5. Stock prices are based on supply and demand. If more people want to buy the stock than sell it, the price is high. If more people want to sell the stock than buy it, the price is low.

[George_1950]

So far, so good. I suppose you have covered the definitions of corporations, capitalism, socialism, and fascism? You might want to consider the history of publicly owned businesses, and the impact of capital gains taxes (or losses). For instance, how much tax doe a corporation pay on its income, and how much income tax does an investor pay on dividends and/or capital gains.