| A | B |
|---|
| wants | things that are not necessary for survival but that add comfort and pleasure to our lives |
| services | things that satisfy our wants through the efforts of other people or equipment |
| needs | things that are necessary for survival, such as food, water, clothing and shelter |
| Federal Reserve system | the central banking organization of the US; also known as the FED |
| demand | the amount of goods and services that people are willing to buy |
| supply | the amount of goods and services available for sale |
| inflation | the general rise in the level of prices for goods and services ove time |
| economic decision making | process of choosing which wants, among several wants being considered will be satisfied |
| consumer | a person who purchases and uses goods or services |
| interest | the price that is paid for the use of another's money. |
| liquidity | the ability to easily convert financial resources into cash without a loss in value |
| goals | the things a person wants to accomplish, such as getting a college education, buying a car, or starting a business |
| personal finance planning | the way people spend, save, and invest their money so that they can have the kind of life they want as well as financial security |
| values | the beliefs and principles a person considers important, correct, and desirable |
| time value of money | increase of money as a result of interest or dividends earned |
| compounding | your money increases faster because you are paid interest on your original deposit and on previously earned interest |
| principal | amount of money you deposit, interest paid |
| interest rate | given as annual percentage rate |
