AP Macroeconomics Unit 4

Front

The cost of borrowed money, usually expressed as a percentage.

Back

interest

Front

Amount of money originally borrowed

Back

Principal

Front

What does CD stand for when talking about investments?

Back

Certificate of Deposit

Front

Because mutual funds spread your investment around in multiple stocks and bonds, they are a great example of this term.

Back

diversification

Front

This is an obligation of repayment, usually including principal plus interest; any time you owe someone money.

Back

debt

Front

The availability of money; how quickly you can convert it into cash in your hand is its _______.

Back

liquidity

Front

Something of value used to secure a loan

Back

Collateral

Front

Who pays interest on a loan?

Back

The borrower

Front

Who pays interest when you deposit money in the bank?

Back

The bank

Front

Which of the following best describes what dividends are? Options: The increased value of a stock., A periodic payment to the owners of a stock., A reward for selecting good stocks.

Back

A periodic payment to the owners of a stock.