accounts. Banks then lend company wants to expand, wants to expand, it can sell this money to businesses it can sell stock to raise bonds to raise money. which use the borrowed money. Bondholders purchase the money to buy equipment or Higher earnings for bonds, and earn interest on products for their businesses increases their the money they have businesses. value, which causes a loaned to businesses and Savers, in turn, earn demand for people wanting the government. interest on money used by to buy the businesses Eventually, the company companies and other stock. pays the bondholders back individuals. their money, with interest. Examples Examples Examples Mary has saved over $800 The bond passed to fund Jason purchased stock of a in a local bank. several city parks. pharmaceutical company. Jack borrowed $600 from a local bank to buy a new oven. ______________________ ______________________ ______________________ ______________________ ______________________ ______________________ ______________________ ______________________ ______________________
accounts. Banks then lend this money to businesses which use the borrowed money to buy equipment or products for their businesses. Savers, in turn, earn interest on money used by companies and other individuals. Examples Mary has saved over $800 in a local bank. Jack borrowed $600 from a local bank to buy a new oven. ______________________ ______________________ ______________________ company wants to expand, it can sell stock to raise money. Higher earnings for businesses increases their value, which causes a demand for people wanting to buy the businesses stock. Examples Jason purchased stock of a pharmaceutical company. ______________________ ______________________ ______________________ wants to expand, it can sell bonds to raise money. Bondholders purchase the bonds, and earn interest on the money they have loaned to businesses and the government. Eventually, the company pays the bondholders back their money, with interest. Examples The bond passed to fund several city parks. ______________________ ______________________ ______________________
1.02_-_revised.docx