Chapter 1: Understanding Personal Finance

Front

The study of personal and family resources important for achieving financial success.

Back

Personal Finance

Front

A pattern of economic activity that includes expansion, peak, contraction, and trough.

Back

The Business Cycle

Front

The sum total of all economic activity.

Back

Gross Domestic Product (GDP)

Front

Interest computed on the principal only, without adding the interest to the principal to determine future interest.

Back

Simple Interest

Front

The calculation of interest on interest as well as on the original investment.

Back

Compound Interest

Front

The cost of the decision measured by the value of the next best alternative that must be foregone (given up).

Back

Opportunity Cost

Front

The steady rise in the general level of prices over time.

Back

Inflation

Front

Which is better: income that is tax-exempt or tax-sheltered?

Back

Tax-exempt

(you don't pay taxes on it ever!)

Front

Who suffers the most during times of high inflation?

Back

People on fixed incomes.

Front

How many steps are there in the financial planning process?

Back

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