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Math 155

STUDY
PLAY
Percent
Just a fancy way of saying "divided by 100." Percentage = (Part/Whole) * 100
Absolute Change
The actual increase or decrease from a reference value to a new value. Absolute Change = New Value - Reference Value
Relative Change
A fraction that describes the size of the absolute change in comparison to the reference value. Relative Change = Absolute Change/Reference Value
Absolute Difference
The actual difference between the compared value and the reference value. Absolute difference = compared value - reference value
Relative Difference
The size of the absolute difference as a fraction of the reference value. Relative difference = Absolute difference/reference value
The Relation of "Of" to "More Than"
Using more than states an increase in the percentage. Using of states a ration of the new percentage to the original.
Interest
The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.
Principle
The money being borrowed.
Simple Interest
Interest that is charged only once over the life of the loan. ***I = PRT
APY
Annual percentage yield. Applied to any investment but not typically a mortgage, to compare investments with different or no compounding schemes.
Compound Interest
Interest paid on the principal plus any previously accrued interest. A = P(1+r)^t
Installment Loan
The loan is paid back in small equal periodic payments.
Periodic Rate
The interest rate described in relation to a specific amount of time. For example, the Monthly Periodic Rate is the cost of credit per month; the Daily Periodic Rate is the cost of credit per day
Revolving Credit
a credit agreement that allows consumers to pay all or part of the outstanding balance on a loan or credit card. As credit is paid off, it becomes available again to use for another purchase or cash advance
Grace Period
length of time you have before you start accumulating interest
Down Payment
upfront payment of a portion of a purchase price, thereby reducing the balance.
Mortgage
a long-term loan extended to someone who buys property
Fixed Rate Mortgage
A mortgage in which the interest rate does not change during the entire term of the loan.
Adjustable Rate Mortgage
Has an interest rate that increases or decreases during the life of the loan.
Balloon Mortgage
a mortgage in which the entire remaining balance of the loan is due in one single payment
Capital Gains
money that is made ( a profit) by selling an asset like a home or stocks
Dividend
The part of the earnings of a corporation that is distributed to its shareholders
Gross Income
the total amount of income from wages before any payroll deductions
Adjusted Gross Income
Is your gross income after certain reductions have been made
Exemption
a deduction allowed to a taxpayer because of his status (having certain dependents or being blind or being over 65 etc.)
Deduction
a reduction in the gross amount on which a tax is calculated
Taxable Income
income on which tax must be paid; total income minus exemptions and deductions
Total Tax
the tax computation based on tax table or rate computation minus any tax credits
Tax Refund
A check returning the taxpayers money to the taxpayer after tax retuns are filed and the over paid tax is determined.
Filing Status
Single or Married.
Standard Deduction
A stated amount that you may subtract from adjusted gross income instead of itemizing your deductions
Itemized Deduction
a specific expense, such as mortgage interest, that you deduct from your adjusted gross income.
Progressive Income Tax
a tax that takes a larger percentage of higher incomes than lower incomes
Marginal Tax Rates
Change in taxes paid divided by changes in taxable income
FICA
Federal Insurance Contributions Act
Short Term Capital Gains
holding period of 12 months or less, taxed as ordinary income
Long Term Capital Gains
holding period of more than 12 months, taxed as capital gains
Tax-Deferred Savings Plans
Money that you put into saving plans that is not taxed.
Continuous Compounding
A = pe^rt