EPF Vocabulary Unit 5 Quiz

What is liability?

• An asset owned by a person or company

• Being responsible for something

• A measure of creditworthiness

• A type of investment

What is an overdraft?

• withdrawal exceeding the available funds

• A loan from a bank that is less than the funds you require

• A type of investment that is larger than you can afford

• A type of insurance that could potentially save you money

What is creditworthiness?

• A measure of how likely you are to default on your debt obligations

• A measure of how much money you owe to creditors

• A measure of how much credit you have available for a mortgage or auto loan

• A measure of how much money you earn in the stock market during a given period

What is principal in finance?

• The interest earned on a loan

• The original amount of money borrowed

• The total amount owed on a loan to your bank or mortgage lender

• The monthly payment on a loan that you make

What is a bond in finance?

• A share of a company's profits that are given out quarterly to shareholders

• a loan made by an investor to a company or government

• A type of insurance policy that ties you to your families policies enabling you to make decisions for them

• A type of credit card that helps build your credit

What is a stock in finance?

• A type of loan

• A share of the value of a company

• A type of bond that gives you a small amount of control of a company

• A type of savings account

What is revolving credit/debt?

• A fixed-term loan which the payment stays the same regardless of market conditions.

• open line of credit that can be used for any purchases under the limit

• A debt tied to a specific tangible asset, such as a mortgage, auto loan or furniture loan

• A type of mortgage

What is diversification or diversifying?

• Investing in a single asset that can pay off huge.

• Investing in a large variety of stocks, to reduce overall risk

• Investing in high-risk assets that could potentially make you rich

• Investing in real estate properties

What is secured credit/debt?

• A type of credit with high interest rates that is not tied to any asset.

• A loan tied to a specific asset that can be used as collateral

• A type of credit without collateral

• A type of credit with no limits