Math Models Review

This type of interest "creates a mathematical explosion," and it can make you wealthy over time, or keep you in debt for a long time.

• compound
• sinking
• annual

Cost of credit expressed as a yearly percentage 

• Mortgage
• Principal
• APR
• Finance company

The cost of borrowed money, usually expressed as a percentage.

• interest
• savings plan
• scarce
• purchase

401(k), IRA, and Roth IRA are all examples of a __________ account.

• Retirement
• College Savings
• Low Interest
• Stock

This term refers to the original amount of a loan OR the original amount of money invested. 

• Principal
• Interest
• Rebate
• Fixed Rate

This is an obligation of repayment, usually including principal plus interest; any time you owe someone money.

• compound interest
• emergency fund
• APR
• debt

Term that applies to the ability to buy something now and pay for it later over a period of time (usually with having to pay a finance charge and/or the addition of interest). 

• Savings
• Profit
• Budgeting
• Credit

Which budget item will most likely take up the largest percentage of your income at 25-30%?

• transportation

• housing

• groceries

• saving/investing

What is a budget?

• A type of savings account

• A way to invest for retirement

• A fund for emergencies

• A financial plan that defines expenses for a period of time.

How many months of expenses should be set aside for an emergency fund?

• 3-6 months

• 6-12 months

• 12-18 months

• 1-3 months