Economics and Finance Terms - L6 Flashcards

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Consumer

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Any person or group that buys or uses goods and services to satisfy personal needs and wants.

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Disposable income

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Income remaining for a person to spend or save after all taxes have been paid.

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Discretionary income

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Monetary income a person has left to spend on extras after necessities have been bought.

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Rational choice

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Choosing the alternative that has the greatest value among comparable quality products.

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Competitive advertising

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Advertising that attempts to persuade consumers that a product is different from, and superior to, any other.

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Informative advertising

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Advertising that benefits consumers by giving information about a product.

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Comparison shopping

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Getting information on the types and prices of products available from different stores and companies.

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Credit

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Receipt of money either directly or indirectly to buy goods and services in the present with the promise to pay for them in the future.

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Principal

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Amount of money originally borrowed in a loan.

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Interest

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Amount of money the borrower must pay for the use of someone else’s money.