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honors personal finance vocab

Terms in this set (19)

standard of living
the necessities, comforts, and luxuries we have or desire
average propensity to consume
the percentage of each dollar of income, on average, that is spent for current needs rather than savings
wealth
depends on the total value of all the items that the individual owns, consists of financial and tangible assets
financial assests
intangible, paper assets, such as savings accounts and securities
tangible assets
physical assets, such as real estate and automobiles
personal finance planning
a systematic process that considers important elements of an individual's financial affairs and is aimed at fulfilling his or her financial goals
financial goals
the results that an individual wants to attain
money
the medium of exchange used to measure value in financial transactions
utility
the amount of satisfaction received from purchasing certain types or quantities of goods and services
goal dates
target dates in the future when certain financial objectives are expected to be completed
flexible-benefit (cafeteria) plan
A type of employee benefit plan wherein the employer allocates a certain amount of money and then the employee "spends" that money for benefits selected from a menu covering everything from child care to health and life insurance to retirement benefits
professional financial planner
An individual or firm that helps clients establish financial goals and develop and implement financial plans to achieve those goals
gross domestic product
the total of all goods and services produced in a country; used to monitor economic growth
expansion
the phase of the economic cycle when levels of employment and production are high and the economy is growing, generally accompanied by rising prices for goods and services
peak
the phase of the economic cycle when an expansion ends and a contraction begins
contraction
the phase of economic cycle when real GDP falls
trough
the phase of the economic cycle when a contraction ends and expansion begins
inflation
a state of the economy in which the general price level is increasing
consumer price index
a measure of inflation based on changes in the cost of consumer goods and services
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