WorksheetsMiddle School Financial Vocabulary List
Total questions: 25
Worksheet time: 15mins
Which statement correctly distinguishes Credit from Loan as defined in the list?
Credit is the original amount borrowed; a loan is the ability to borrow money
Credit is the ability to borrow money and pay it back later; a loan is money borrowed that must be repaid, usually with interest
Credit is money you owe; a loan is extra money earned when saving
Credit is money set aside; a loan is money left after costs
According to the definitions, what is Principal?
A report that shows what a person or business owns and owes at a certain time
The original amount of money borrowed or invested before interest
Money you lend to a company or government that pays you back later with interest
Ownership in something after debts are paid
Which option best explains Profit as used in the vocabulary list?
The money left after all costs and expenses are paid
The extra money you earn or pay when saving or borrowing money
Something valuable that you own, like money, property, or investments
Money borrowed that must be repaid
Identify the correct definition of Equity from the list.
Ownership in something, such as a company or property, after debts are paid
How easily something can be turned into cash
A financial contract whose value depends on another asset
A place where people buy and sell investments like stocks and bonds
Which statement accurately matches the investment terms?
Stock: You lend money to a company; Bond: A share of ownership in a company
Stock: A share of ownership in a company; Bond: You lend money to a company or government that pays you back later with interest
Stock: Financial products that can be traded; Bond: A document showing income and expenses
Stock: Extra money you earn; Bond: Money left after costs
Liquidity is defined as:
The chance of losing money on an investment or decision
How easily something can be turned into cash
The length of time until a loan or investment ends
A place where people buy and sell investments like stocks and bonds
Which term corresponds to “The chance of losing money on an investment or decision”?
Risk
Asset
Derivative
Term
A Balance sheet is described in the list as:
A document that shows financial information like income and expenses
A report that shows what a person or business owns and owes at a certain time
The extra money earned or paid when saving or borrowing
Money coming in and going out of a business
What is the Financial market according to the vocabulary list?
A report that shows what a person or business owns and owes
A place where people buy and sell investments like stocks and bonds
The money left after all costs and expenses are paid
A financial contract depending on another asset
Derivative is defined as:
The length of time until a loan or investment ends
A financial contract whose value depends on another asset (like a stock or bond)
Something valuable that you own, like money, property, or investments
Money borrowed that must be repaid, usually with interest
What is the main purpose of an Auto Loan?
To buy a house
To invest in stocks
To buy a car
To save for retirement
Money borrowed from someone else with the expectation of paying it back.
SYNONYMS
credit, advance
cash
borrow
loan
jar
What can you do to avoid debt?
Spend more money than you earn
Use all your savings to buy expensive things
Only use money that you have, instead of borrowing
Borrow money from many different people
What does it mean to have debt?
You have saved a lot of money
You owe money to someone or a company
You have a lot of money in your wallet
You found money on the street
The interest rate a credit card user will be charged on the unpaid portion of their balance
High Rate Method
Credit
Credit Bureau
Annual Percentage Rate (APR)
Why is it important to understand interest rates when taking out a loan?
Lower interest rates mean you pay back more money
Interest rates do not affect loans
Higher interest rates mean you pay back less money
Interest rates determine how much extra money you need to pay back
What should you NOT use a loan to purchase?
A house
Tuition for higher education
Airline tickets to your dream vacation
A car
Credit allows for purchases without cash.
True
False
What should you do if you find yourself in debt?
Ignore the debt and hope it goes away
Borrow more money to pay off the debt
Create a plan to pay off the debt over time
Spend more money to distract yourself from the debt
