STHM 1113 Lecture Notes - Lecture 2: Berkshire Hathaway, Dow Jones Industrial Average, New York Stock Exchange
6 May 2018
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• Closing Bell - An audible signal indicating the end of the regular trading day on an
exchange.
• Conglomerate - Large corporation run as a single business, but made up of several firms
(acquired through mergers or takeovers) supplying diverse goods and/or services.
Berkshire Hathaway Inc. is one of the biggest conglomerates in the world, with
ownership of insurance, utilities, financial, and retail companies.
• Dow - The Dow Jones Industrial Average (DJIA) is a price-weighted average of 30
significant stocks traded on the New York Stock Exchange (NYSE) and the NASDAQ.
• Bellwether - An event or indicator that shows the possible presence of a trend. The
performance of certain companies/stocks and bonds are considered by analysts to
indicate the condition of the economy and financial markets because their performance
is well-correlated with a trend.
• Revenue - The income generated from sale of goods or services, or any other use of
capital or assets, associated with the main operations of an organization before any
costs or expenses are deducted. Revenue is shown usually as the top item in an income
(profit and loss) statement from which all charges, costs, and expenses are subtracted to
arrive at net income.
• Earnings Report - include items such as net income, earnings per share, earnings from
continuing operations and net sales. They are usually released on a quarterly basis, and
assess the performance of the company.
• Profit & Revenue Terms
o Revenue is:
o - Income generated from the sale of goods or services before any costs or
expenses are deducted. Also called sales.
o Business Dictionary definition:
http://www.businessdictionary.com/definition/revenue.html
o Ex. My niece held a lemonade stand and made $22 in Revenue/Sales.
o Profit Is:
o - The difference between what it costs to make and sell a product and what a
customer pays for it.
o - Also, the surplus remaining after costs are deducted from revenue.
o Business Dictionary definition:
http://www.businessdictionary.com/definition/profit.html
o E. M iece’s $22 i sales fro her leoade stad did ot factor i the cost of
the cups, the purchase of the lemonade mix & water, the lemonade pitcher, and
the labor that went into making the lemonade or setting up the stand. Her actual
profit may only be $10 after all of these expenses.
• Bullish - A positive outlook on business activity for a future period of time.
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