A1- functions and role of money Flashcards
definition-unit of account
a standard unit of money used to measure value, record debts and calculate profits or losses.
definition-means of exchange
system used to facilitate the purchase and sale of goods and services between parties.
definition-store of value
an asset that maintains its value, rather than depreciating.
definition-legal tender
the coins or banknotes that must be accepted if offered in payment of a debt
definition-personal attitudes
individuals will vary in their attitude to risk and reward as well as saving and borrowing.
definition-life stages
the different ages and phases of life that people go through as they grow and learn
definition-culture
the ideas, customs and social behaviour of a particular person or society. different cultures have different beliefs on how an individual should handle thier money.
definition-life events
a significant occurance in a persons life that can have a physiological impact
definition-external influences
factors that affect a business or individual that are outside of their control
definition-interest rates
the percentage of the amount of money borrowed or saved that is paid or recieved in interest over a year
definition-avoid debt
the practice of not getting into debt or avoiding the act of paying back debt
definition-control costs
the process of identifying and reducing a business expense to increase profits
definition-legal action/repossession
legal process where a mortgae lender or secured loan provider takes ownership of a property
definition-solvent
having assets in excess of liabilities - able to pay ones debt
definition- credit rating
an opinion about how likely a person or business is to repay a loan or debt
definition-bankruptcy
a legal status that allows people to deal with debts thay can’t pay
definition-manage money
the process of planning and tracking how an individual or group uses their money
definition-income and savings generation
used to describe an investment or business activiry that makes money - household saving, income generation, net household saving
definition- financial targets and goals
the personal, big-picture objectives you set for how you will save and spend money
definition-insurance
a contract, represented by a policy in which a policy holder recieves financial protection or reimbursement against losses from an insurance company
definition-inflation
a measure of how much prices for goods and services increase over times
