3.4 Harvey REVIEW: Equations, Budgets, & Net Worth

Front

What are Assets?

Back

Assets are resources owned by an individual or entity that have economic value. They can include cash, real estate, vehicles, and investments.

Front

What are Liabilities?

Back

Liabilities are obligations or debts that an individual or entity owes to others. They can include loans, mortgages, and credit card debt.

Front

How do you calculate Net Worth?

Back

Net Worth = Total Assets - Total Liabilities.

Front

What is the value of Assets if they total $3920?

Back

$3920.

Front

What is the value of Liabilities if they total $2230?

Back

$2230.

Front

If Assets are $3920 and Liabilities are $2230, what is the Net Worth?

Back

Net Worth = $3920 - $2230 = $1690.

Front

What does a negative Net Worth indicate?

Back

A negative Net Worth indicates that liabilities exceed assets, meaning the individual or entity owes more than they own.

Front

What is the current value of Andrew's car if it is $1360?

Back

$1360.

Front

If you have $3920 in Assets and $2230 in Liabilities, what is your financial position?

Back

You have a positive Net Worth of $1690.

Front

What is the significance of budgeting?

Back

Budgeting helps individuals manage their finances by tracking income and expenses, ensuring they live within their means.