46 terms

Financial Literacy Vocabulary

STUDY
PLAY
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
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
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
FDIC
Is the Federal Deposit Insurance Corporation.
APR
Annual Percentage Rate.
APY
Annual Percentage Yield.
Yield
The rate of return received for one whole year, including the compound interest.
CD
Certificate of Deposit.
FDIC
Federal Deposit Insurance Corporation.
Bankruptcy
Legally declared inability or impairment of ability of an individual or organizations to pay their creditors.
Expenditures
Is money spent, or an amount of money spent, as a whole or on a particular thing.
Credit card
Is a card for deferring payment; is issued by a bank or business allowing a person to purchase goods and services and pay for them later (with interest).
Mortgage
Is a loan agreement that is secured by property; when person borrows money from bank, they give bank right to take property away if loan is not repaid.
Default
To fail to pay debt.
Parent company
Is a company that owns controlling interests in subsidiary companies.
Return on investment (ROI)
A measure used to evaluate the efficiency of an investment or compare efficiency of a number of different investments.
Percentage gain
A calculation used to determine the gain in something such as a stock.
Down payment
A part of the full price of something paid when it is bought, with the remaining part to be paid later.
Equity
Ownership interest in a corporation in form of common stock or preferred stock.
Foreclosure
The removal of your right to redeem mortgage because of failing to make payments.
Real Estate
Land including all the natural resources and permanent buildings on it.
Ethical Investment
An investment in a company with socially desirable characteristics such as good working conditions and good environment conditions.
NYSE
Is the New York Stock Exchange.
DJIA
Is the Dow Jones Industrial Average.
Censorship
An action taken to hide information from the public, especially for political reasons.
Affluenza
A condition that has the desire to be more wealthy or successful.
Consumerism
The idea of buying many goods that you may not even use and instead store away.
Consumption
The act of purchasing goods and services.
Start-up expenses
Expenses that you have to pay for before you start up a business.
Income statement
A statement that shows your profit or loss during a particular period.
Profit and loss statement
A statement that shows your revenues, costs, and expenses during a particular period.
Balance sheet
A statement that shows your assets and liabilities for a given period.
Cash flow sheet
A statement that shows how balance sheets and income affect cash and cash equivalents.
Dividend
A stockholder's share of a profit.
Commodity
Something that is valued and is bought and sold.