Financial Knowledge Kit

1. Interest

The banker's son askshis father, “Dad, all the money in the bank belongs to customers and depositors. How do you earn your house, your Mercedes Benz and your yacht?” Bankersays, “son, thereis a piece of fatmeatin the fridge. Bring itover.” Theson brings it. “Put it back.” The son asks, “What do you mean?” The banker says, “Do you see oil on your fingers?”

2. Investment Bank

A green handin an investment bank asks, “What is an investment bank?” The elder takes some rotten fruits and asks him, “How are you going to sell these fruits?” The green handthinksit overfor a long time and says, “I'll sellthem at a discount price according to the market price.” The elder shakes his head, picks up a fruit knife, peels and cuts the rotten fruit into pieces, and makes a beautiful fruit plate: “Just likethis, sell it at dozens times of the price.”

3.Sales

Aboy says to a girl, “I'm the best, I promise to make you happy, pleasebe my girlfriend.”This is selling. The boy says to the girl, “My father has three houses, marryme, it will be yours in the future.”This is promotion. The boy doesn’texpress himselfto the girl at all, but the girlisfascinated by the boy temperament and demeanor.This ismarketing. The girl doesn't know the boy, but all her friends praise him. This is the brand.

4. Parking

A rich man borrowed$5,000 from a Wall Street bank for two weeks. He has to show the object of pledge for the bank loan. So he used hisRolls Royce parked at the door as collateral. The bank staff parked his Rolls Royce in the underground garage and lent the richman$5000. Two weeks later, the rich man returned the money with $15 interest. The bank staff found that there were tens of millions of dollars in thisrichman's account and asked why hehad to borrow money. Rich man said, $15fortwo-week parking, you will never find it onWall Street.

5. Luxury Goods

The Economics teacher talked about luxuries one day. In order to make it easy to understand, he said, "Do you know what a luxury item is? If you are shopping with your girlfriend, your girlfriend is staring at something for more than 30 seconds, and you should pay for it, then it is a luxury item." The students all nodded with a smile. He continued, "Then if your girlfriend is staring at another thing for more than 30 seconds, my friends, your girlfriend is luxury!"

6. Long Term Investment

An 8-year-old girl came to the farm to buy a melon with 30 cents. Seeing that her money was not enough, the melon farmer wanted to fool the little girl to leave. He pointed to an unripe melon and said, "30 cents only can buy that small melon." The girl agreed and happily handed the money to the farmer. The melon farmer was surprised," This melon is not ripe, why do you want to eat it?" The girl said, "This melon belongs to me now. When it is ripe, I will come and take it."

7. Industrial Economy

In the class, the professor lectured on economics, "What is the primary industry? Like feeding cattle and raising sheep. What is the secondary industry? Like eating beef and drink the mutton soup." Then a student asked, "Well, what is the cultural industry?" Professor's eyes are brightened, and he said, "Good question!" then answered, "The so-called cultural industry is boasting without shame and making a fool of themselves."

8. Non-profit Investment

"Please give me an example to explain what is a non-profit Investment," the professor asked. "Take your sister out," one of the boys answered.

9. Game Theory

If all four boyschase a pretty girl, she’ll put on airs and ignore everyone. Then the boyschase after another girl, that girl will not accept anyone of the four boys, because nobody wants to be substitution. But if the four boys chase after the other girl first, then the pretty girl will be isolated and she will be much easier to chase after. - Nash, the math master,gavethe simplest expression of game theory.

10. Poor People Tax

There is an economic term called “Poor people tax”, the typical exampleis that people whobuy lottery are mostly poor (please don’t take personally if you buy lottery very often) , this is the chance which they can stimulate their wealth in short time within their bearing capacityand paying capacity.But winninga prize in a lottery is small probability.Over time, it is like small flow of water, more money going out and less money coming in. So it is like paying tax.

11. Pareto Distribution

If put the wealth of everyone in this world in array,you will see one side is very thin and reach into sky,but the other side is despairing, endless flat.This distribution is called “Pareto distribution”in economics.

12. Four Principles of Pleasure and Pain

Pick up 75 dollarsin one time, or pick up 50 dollarsfirst then pick up 25 dollarslater, which one you will choose? Lose 75 dollarsin one time, or lose 50 Yuan first then lose 25 Yuan later, which one you will choose? It turns out that most people choose pick up 75 separately and lose 75 together. These are the four principles of pleasure and pain in economics: Good news should be published separately; Bad news should be published together; One big bad news and one small good news should be published separately; One Big good news and one small bad news should be published together.