Personal Finance Final Study Guide

Setting aside money for future use, usually in a bank is called

• banking

• investing

• saving

The process of setting money aside to increase wealth over time for long-term financial goals such as retirement is called

• investing

• saving

• windfall

Unexpected financial gain is called

• fraud

• windfall

• insurance

When investors are deceived by individuals claiming to be financial advisors or have an investment guaranteed to make money, this is called

• investment tolerance

• investment stock

• investment fraud

Interest earned only on the original principal amount invested is called

• simple interest

• compound interest

Interest earned on both the principal amount and any interest already earned is called

• simple interest

• compound interest

What is inflation?

• a financial security that represents a promise to repay a fixed amount of funds

• a general increase in prices and fall in the purchasing value of money.

• a type of insurance used by vehicle owners to cover costs associated with car accidents.

An asset is

• Anything of value that is owned

• A debt or something disadvantageous

A liability is

• Anything of value that is owned

• A debt or something disadvantageous

A bond is

• A share of ownership in a company

• A financial security that represents a promise to repay a fixed amount of funds