Financial Math CH 3 Vocab Quiz

Definition: is an average based on an investment's past performance (because investments don't grow at the same rate all the time). This is a millionaire's best friend.

• Interest rate

• Inflation

• Compound interest

• Compound growth

Definition: Pay cash for college

• 1st Foundation

• 5th Foundation

• 3rd Foundation

• 4th Foundation

Definition: Pay cash for car

• 1st Foundation

• 5th Foundation

• 3rd Foundation

• 4th Foundation

Definition: The main reasons for saving your hard-earned money.

• Daily expenses, subscriptions, bills

• Emergency, large purchases, wealth building

• Travel, entertainment, luxury items

• Investing in stocks, gambling, loans

Definition: Interest earned on both the principal amount and any interest already earned.

• Compound growth

• Compound interest

• Inflation

• Interest rate

True/False

Although it may start at zero percent interest, they are banking on you making one late payment to revoke the zero percent and start charging you interest, or the zero percent will end in a year and lead to interest in the long run.

• True

• False

Have less than $1,000 saved for an emergency.

• 60% of Americans

• 75% of Americans

• 25% of Americans

• 47% of Americans

Build wealth and give.

• The 3rd Foundation

• The 2nd Foundation

• The 1st Foundation

• The 5th Foundation

Get out of debt, and stay out of debt.

• The 1st Foundation

• The 3rd Foundation

• The 2nd Foundation

• The 4th Foundation

In order to outpace inflation when investing, your investments need to have a ______of return than the rate of inflation.

• profit

• lower rate

• higher rate

• Zero percent Interest