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The Corporation

The Corporation. 2.2 pages 42-45. Capital – money used by a company for start-up costs Stockholder – people who buy shares of stock in a company; they are part owners. Primary capital market A corporation sells stock directly to investors Like buying a new car from the company

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The Corporation

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  1. The Corporation 2.2 pages 42-45

  2. Capital – money used by a company for start-up costs • Stockholder – people who buy shares of stock in a company; they are part owners

  3. Primary capital market • A corporation sells stock directly to investors • Like buying a new car from the company • Secondary capital market • Stockholders sell shares to each other • Like buying a used car

  4. IPO – initial public offering • New, small companies • Risky investment • Exchanges – auction markets • New York Stock Exchange (NYSE) (Wall Street) • American Stock Exchange (AMEX)

  5. Over-the-Counter (OTC) • National Association of Securities Delaers Automated Quotes (NASDAQ) • Stockbroker – a person who helps others buy & sell stocks • Advice can be useful • Earn commission fees • Be careful about choosing a stockbroker

  6. Securities and Exchange Commission (SEC) • Policeman of the securities industry • Establishes and enforces regulations • Protect the public from unfair practices

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