Vocabulary Week 1

What does "Equity" mean in financial terms?

• The amount of money spent on goods and services

• The ownership interest in a company, represented by shares

• The money borrowed to finance investments

• The total value of assets owned by an individual or business

The company raised ______by selling shares to investors

Which of the following is an example of "Collateral"?

• A car used as security for a loan
  

• Cash

• Stocks

• Bonds

I purchased government _____to earn a steady stream of interest income

What is the primary difference between a "Bond" and a "Stock"?

• Bonds pay fixed interest, while stocks pay dividends

• Bonds have a fixed maturity date, while stocks have no maturity date

• Bonds represent ownership in a company, while stocks represent debt

• Bonds have no risk, while stocks carry significant risk

How does "Depreciation" differ from "Capital"?

• Depreciation is the allocation of the cost of an asset over its useful life, while capital is the money invested in a business

• Depreciation is a form of financing, while capital is a form of asset

• Depreciation is the increase in value of an asset, while capital is the decrease in value

• Depreciation is a short-term financial concept, while capital is a long-term financial concept