Financial Lit. Vocab
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15 terms
Terms | Definitions |
|---|---|
 Interest | a fixed charge for borrowing money; usually a percentage of the amount borrowed; "how much interest do you pay on your mortgage?" |
| Simple interest | interest paid on the principal alone |
| Compound interest | interest calculated on both the principal and the accrued interest |
| Credit rating | an estimate, based on previous dealings, of a person's or an organization's ability to fulfill their financial commitments |
| Financial opportunity | An opportunity to make money |
| Rate of return | The return on an investor's capital. Also called Yield. Expressed in a percentage |
| Investment | t money that is invested with an expectation of profit |
| Revenue | The total amount of money made. |
| Net income | Also called profit. Calculated as the Revenue - Expenses |
| Budget | A plan of incoming and outgoing monies. Expense and Income. |
| Expenses | an expense is an outflow of money to another person or group to pay for an item or service, or for a category of costs. |
| Net Worth | The difference between your total assets and total liabilities |
| Income Statement | a financial document that shows how much money (revenues) came in and how much money (expenses) was paid out |
| Principal | The money originally invested or loaned, on which basis interest and returns are calculated |
| APR | Annual Percentage rate |
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