| A | B |
|---|
| Net Worth | assets minus liabilities |
| Federal Reserve Board | control the nation's money supply |
| Variable Expenses | clothing and food |
| Revolving Credit | credit card is an example of |
| Checking Account | Insured by Federal Deposit Corporation |
| Internal Revenue Service | IRS stands for |
| To calculate return on investment (ROI) | subtract your investment from your return and divide by the investment |
| High Credit Score | very likely to repay borrowed funds |
| Maintain Competition | major economic role of government in market economy |
| Risk, Rate of Return, Liquidity | criteria when choosing investment |
| Wages & Salaries | most money received by American businesses paid out as |
| Fiscal Policy | changes in government spending and taxes to influence the economy |
| Certificate of Deposit | savings alternative with lowest risk and lowest reward |
| Employee & Employer | who pays FICA contribution |
| $400 at 5% interest per year, how much will you earn after 12 months? | $20 |
| Net asset value | the in a mutual fund, the price per share that investors pay |
| In the U.S. economy, competition | helps keep prices down |
| Zero-coupon bond | bond that pays all of its interest and principle at the bonds maturity date |
| Three C's of credit | capacity, character, and collateral |
| XYZ Corp has 1,000,000 outstanding shares at @25.25 per share, the market capitalization for this company | $25,250,000 |
| Compound interest is interest paid | on the principle and on the interest earned |
| Whole Life | insurance that provides cash value and protection |
| Progressive Tax System | tax system that taxes higher income at higher rates |
| Factors used to determine credit scores | bills are paid on time, amount owed on accounts, # of credit cards, # years person has had credit |
| Income Stock | stock that pays dividends regularly |
| Difference between gross income and net income | net income is gross income minus payroll deductions |
| You use $1.00 to buy candy instead of ice cream, what is opportunity cost of buying candy | buying ice cream |
| W-2 Form | form listing annual earnings and amounts withheld from paycheck |
| Federal Trade Commission | government body regulates credit card safety |
| Nominal rate of return on investment is 6% and inflation 3%, what is real rate of return | 3% |
| Auto collision insurance pays for | damage to my car if I crash it |
| Examples of assets | jewelry, real estate, bonds |
| Disadvantage of revolving credit account | balances can rise quickly if only minimum payment is made |
| Trade off if you get 15 year mortgage rather than 30 year mortgage | you pay lower total interest but make higher monthly payments |
| Truth in Lending Act includes | finance charges, minimum monthly payment required, annual fees |
| No-load fund | Mutual Fund without a sales charge |
| Major advantage of a debit card over a credit card | you don't have to pay interest or monthly bills |
| Inflation | you put your $ in a 1% savings account. After 2 years your purchasing power has decreased. Example of |
| Julia invested $10,000 in security that will double in 10 years. Approx. what annual rate of return is this investment making? | 7.2% |
