How does a business make money?

Watch this short instructional video on stocks and bonds. While this deals primarily with stocks and bonds, it does give you a good idea of how companies grow and create wealth. Learn the following terms: Assets, Liabilities, and Owners Equity. These are the elements of a balance sheet. If you know these terms, you can read one from any company and judge it's health. Write down each of the three terms and we'll discuss them. How would a company go bankrupt? How would a company increase it's equity?

Watch the following episode of Shark Tank. Watch and listen carefully. Pay attention to what priorities they have and how their priorities might differ from the contestants. Who gets a "bite" from the sharks and why?

Think: What questions do the Sharks tend to ask each contestant? Why would a "Shark" value a company higher than it's assets? Is there some other value other than what's on the balance sheet?

Assignment:

Write an e-mail to your instructor(manersj@k12tn.net). Explain what common questions the Sharks ask. Why do you think these questions are important? Write a paragraph and back up your answer with your observations. Your e-mail is due by midnight Saturday night. You have some time on this so give it your best effort. I want to see how observant you are and how well you can listen.