Personal Finance Vocabulary Quizs

Liability

• obligation or debt owed to others

• a type of asset

• a financial statement

• a legal document

Interest Rate

• charged for borrowing money

• a fee for saving money

• a tax on investments

• a penalty for late payments

Asset

• of value owned by an individual

• an item that is worthless

• a liability that must be paid

• an investment that loses value

Credit Score

• A measure of a person's income

• A rating of a person's creditworthiness

• A type of loan

• A bank's interest rate

Inflation

• general increase in prices and fall in purchasing value of money

• decrease in prices and increase in purchasing value of money

• stability in prices with no change in purchasing power

• fluctuation in prices without affecting purchasing power

Amortization

• repayment of a loan over time

• a method of calculating interest

• a type of investment strategy

• the process of writing off an asset

Net Income

• after taxes and deductions

• before taxes and deductions

• only from investments

• excluding any expenses

Capital Gain

• profit from selling an asset at a higher price than purchase

• a loss incurred from selling an asset at a lower price than purchase

• the total value of an asset after depreciation

• the interest earned on an investment

Budget

• A plan for managing income and expenses over a period

• A method for saving money

• A type of investment strategy

• A financial report of past expenses

Diversification

• investments to reduce risk

• a strategy to increase market share

• a method to enhance product quality

• a technique for cost reduction