Glossary of terms used on this site

A balance sheet is a financial statement that reports a company's assets, liabilities and shareholders' equity at a specific point in time, and provides a basis for computing rates of return and evaluating its capital structure. It is a financial statement that provides a snapshot of what a company owns and owes, as well as the amount invested by shareholders.

A period (such as the early 2000s and late 2000s) when the stock market experiences a strong downward swing. It is often accompa- nied by (and sometimes precedes) an economic recession. Imagine a bearin hibernation, because this is what happens in a bear market: Investors hibernate, and the market falters. During a bear market, the value of stocks can decrease significantly. The market usually has to drop at least 20 percent from its peak before it is considered a bear market.

The stock of the largest and most consistently profitable corporations. This term comes from poker, where the most valuable chips are blue. This list is unofficial and changes.

A loan investors make to a corporation or government. Bonds generally pay a set amount of interest on a regular basis. They’re an appropriate investment vehicle for conservative investors who don’t feel comfortable with the risk involved in investing in stocks and who want to receive a steady income. All bonds have a maturity date when the bond issuer must pay back the bond at par (full) value to the bondholders (lenders). Bonds should not be your primary long-term investment vehicle, because they produce little real growth on your original investment after inflation is factored in.

The break-even point (BEP) in economics, business—and specifically cost accounting—is the point at which total cost and total revenue are equal, i.e. "even". There is no net loss or gain, and one has "broken even", though opportunity costs have been paid and capital has received the risk-adjusted, expected return. In short, all costs that must be paid are paid, and there is neither profit nor loss.

A bubble is an economic cycle characterized by the rapid escalation of asset prices followed by a contraction. It is created by a surge in asset prices unwarranted by the fundamentals of the asset and driven by exuberant market behavior. When no more investors are willing to buy at the elevated price, a massive sell-off occurs, causing the bubble to deflate.

A period (such as most of the 1990s and mid-2000s in the United States) when the stock market moves higher, usually accompanied and driven by a growing economy and increasing corporate profits.

The business cycle describes the rise and fall in production output of goods and services in an economy. Business cycles are generally measured using the rise and fall in the real gross domestic product (GDP) or the GDP adjusted for inflation.The business cycle should not be confused with market cycles, which are measured using broad stock market indices. The business cycle is also different from the debt cycle, which refers to the rise and fall in household and government debt.The business cycle is also known as the economic cycle or trade cycle.

A business model is a company's plan for making a profit. It identifies the products or services the business will sell, the target market it has identified, and the expenses it anticipates.

A business valuation is a general process of determining the economic value of a whole business or company unit. Business valuation can be used to determine the fair value of a business for a variety of reasons, including sale value, establishing partner ownership, taxation, and even divorce proceedings. Owners will often turn to professional business evaluators for an objective estimate of the value of the business.

The term business-to-consumer (B2C) refers to the process of selling products and services directly between consumers who are the end-users of its products or services. Most companies that sell directly to consumers can be referred to as B2C companies.