What is Economy? The word economy means everything related to the production and use of goods and services in an area. On a daily basis we buy many things (products) that come from many businesses, such as, food, drinks, toys, cars, etc. When we buy or not buy such products it affects businesses, economy and all of us.
What is a Business? Business offers goods and services to customers for money. Businesses create jobs for people who work to make goods and or provide services for other who need them.
Who are the Workers? The people who work at the businesses are also called workers. Workers are paid money which they use to take care of their loved ones. When these workers are paid money they pay some money to the governments, called taxes, so that the government can provide the services to the communities where we live such as schools, police, fire station, parks, roads, and many more.
What are Goods? Goods are things that you can see, such as toys, balls, dolls, candies, cereals, etc.
What are Services? Services are things that are done for others for money, such as, barber gives you the service of cutting hair, waiter serves you food at the restaurant, etc.
What is a Stock? A stock is a share of a business. So when you buy a stock of a company, say, McDonald’s, you become a McDonald’s shareholder or part owner of the business.
What is DOW? The Dow (also known as DJIA or Dow Jones Industrial Average) tracks 30 large US companies stocks and it is 100 years old. DOW going up is good news as it indicates that the companies are expected to do well in the future.
What is S&P500? Standard & Poor’s 500, is also called S&P500. It tracks 500 companies and how they are doing. It is over 50 years old and most widely used because it is a better way to track the stock market. It represents over 7 out of 10 US public companies.
What is NASDAQ? NASDAQ stands for National Association of Securities Dealers Automated Quotations system. It sounds complicated but it is a highly computerized stock market. It was started in 1971. It has over 3,200 companies that are leaders in technology, communication, media etc.