23 terms

3. Family Economics

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income effect
This is the increase or decrease in purchasing power brought on by changes in prices.
substitution effect
This refers to how people may buy a lower-priced product rather than a more expensiv product. This effect may change the demand for a good or service.
substitute goods
These are those goods that can be used to replace purchases of other goods when prices rise.
complimentary goods
These are goods that are commonly used withother goods.
diminishing marginal utility
The amount of satisfacton a person receives from using a product affects the demand for that product.
$144,000
This is the estimated cost of rearing a child until the child is eighteen years old.
$50,000
This is the estimated cost of putting a child through college.
physical fitness
Health choices made early in life can have a dramatic impact on lifelong fitness.
exercise
This is vital to lifelong health.
term insurance
This type of insurance is purchased for a certain time period with a specific premium cost.
variable life insurance
This insurance is purchased for the secondary purpose of investing. The company will invest the premiums.
whole life insurance
This insurance is purchased for the duration of a person's life. This insurance may pay an investment dividend. Premiums usually remain consistent throughout the term of the policy.
universal life insurance
This insurance is purchased for a set premium cost with the option of paying in more that premium. The additional funds are invested.
false
(true or false) All needs of everyone in the family are always met.
W4
This form should be adjusted to change tax witholdings.
health
This is the type of insurance that most states offer for children.
diminished marginal utility
This term is defined as the lack of satisfaction a person receives from using a product repeatedly.
true
(true or false) Your child will need health insurance, life insurance, dental and vision insurance.
false
(true or false) Increased salary is a result of an unplanned pregnancy.
lowered prices
This event might cause people to buy more of a product.
individual careers
This does not change when a person forms his or her own family.
true
(true or false) Single-parent households tend to spend less money on raising a child.
year-end tax credit
This is a government-backed financial plus for having a child.
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