Key Terms

bubble	The state of a market where the current price is far above its value determined by fundamentals.



efficient market	All information is taken into account by participants in a market.



fundamentals	Elements that determine stock prices that make long-term economic sense—profit expectations and interest rates.



initial public offering (IPO)	A company’s first sale of stock to the public in an attempt to raise money for expansion.



stock index	A weighted average of stock prices in a particular group.

2003 McGraw-Hill Higher Education
Any use is subject to the Terms of Use and Privacy Policy.
McGraw-Hill Higher Education is one of the many fine businesses of The McGraw-Hill Companies.