Unit 3 Vocab

Front

Annual Percentage Rate (APR)

Back

The total yearly cost of borrowing money, shown as a percentage.

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Amortization Tool

Back

A tool (usually online) that shows how each payment on a loan is split between interest and principal over time.

Front

Simple Interest

Back

Interest calculated only on the original amount of money borrowed or invested.

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Compound Interest

Back

Interest calculated on both the original amount and the interest that has been added to it.

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Fixed Interest

Back

An interest rate that does not change over the life of the loan or investment.

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Variable Interest

Back

An interest rate that can change over time depending on the market or agreement terms.

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Banks

Back

Financial institutions that offer savings, checking, loans, and credit services to individuals and businesses.

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Credit Unions

Back

Non-profit financial institutions owned by members, often offering lower interest rates and fees.

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Payday Lenders

Back

Businesses that offer short-term, high-interest loans typically due on the borrower’s next payday.

Front

Title Pawn Lenders

Back

Companies that offer loans using a borrower’s vehicle title as collateral, often with high fees and interest rates.