8 MT Flashcards
investment
the commitment of resources to a project or purpose that is expected to bring future profit to the investor
debtor
a person who borrows money or capital
creditor
a person who lends money or capital
checking account
an account that allows checks to be written up to the dollar amount the account holder has deposited
check
an account holder’s written order that authorizes his bank to withdraw funds from his account
money market account
an account that allows limited transactions and pays and interest rate that changes with the demand for loans
FDIC
governmental agencies that insures private banks and accounts up to $250,000 per depositor
premium
amount paid to an organization in exchange for insurance coverage
stocks
the resources corporations gather by selling ownership in their businesses
shares
equal portions of a corporation’s stock
dividend
a share of a corporation’s profit
bond
a document that guarantees the bondholder the amount of his original investment plus a specified rate or interest by a certain date; one of the safest forms of investment
liquid investments
an asset, such as a stock bond, or mutual fund, that can be easily converted into other investments or cash without much time or difficulty
the grasshopper and the ant
everybody needs to save in preparation for the possibility of future hard times
the ant and the grain of wheat
shows the benefits of investment. you can end up with a lot more than you had before
joseph and the bread seller
those that save are often paid well for the use of what they have reserved when other people need to borrow it
parable of the talents
Jesus followers must make good use of their time and resources on earth
savings account
a bank account that allows the account holder to earn interest on deposits
certificate of deposit
a savings account that guarantees a certain interest rate and has a specified maturity date
insurance
contract between two parties in which one party protects the other against certain types of loss in exchange for payments
pension plan
an arrangement provided by an individual’s employer for the intent of providing for the employee’s retirement from work
defined benefit plan
a type of pension plan in which an employer pledges to pay an employee a certain amount per month after retirement based upon the employee’s salary and length of service *employees don’t contribute money
stockholders
a person who owns shares of stock in a corporation
limited liability
legal protection provided to stockholders of a corporation; if a corporation fails to declare bankruptcy, the individual stockholders do not personally have to pay the firm’s creditors
cash dividends
payment in the form of money
stock dividends
payment in the form additional stock in the firm
common stock
a type of stock that allows holders to vote concerning corporate matters; common stock pays dividends only after paying diffident to preferred stockholders
preferred stock
a type of stock that pays its holders an annual fixed amount in cash dividends if the company makes enough profit in a year to pay them
mutual funds
investment company that combines the resources of all its shareholders and invests the money in a wide variety of areas
three key elements that determine how much of your investment will grow
time, rate of return, and amount invested
