Unit 5 Review

Front

What is net worth?

Back

Net worth is the value of all assets owned minus the total of all liabilities owed.

Front

How do you calculate net worth?

Back

Net worth is calculated by subtracting liabilities from assets.

Front

What is the formula for calculating simple interest?

Back

Simple Interest = Principal x Rate x Time.

Front

If a student borrows $1000 at an 8% interest rate for 2 years, what is the total amount to be repaid?

Back

$1160.

Front

What type of expense is a house payment or mortgage?

Back

Fixed Expense.

Front

What is considered an asset?

Back

An asset is anything of value owned, such as savings.

Front

What is a fixed expense?

Back

A fixed expense is a cost that does not change from month to month, like rent or mortgage.

Front

What is a variable expense?

Back

A variable expense is a cost that can change, such as groceries or entertainment.

Front

If a car loan of $10,000 is taken at a 6% interest rate for 3 years, what is the total amount to be repaid?

Back

$11,800.

Front

What is the difference between assets and liabilities?

Back

Assets are what you own, while liabilities are what you owe.