Final Flashcards
Opportunity Cost
Your next best option – the choice you could have made but did not make.
Human resources (examples)
The physical, intellectual and creative talents of people.
Capital resources
man-made goods such as tools and factories.
Natural resources
gifts of nature such as water and natural gas.
Scarcity
A fundamental condition of all economic systems. Because of scarcity we must make choices.
Wealth
How much a person has in property, investments, income, etc.
Banking fee’s
Charges imposed by financial institutions on their customers for various services.
Advantages of an entrepreneur
Proves flexibility of working hours and job satisfaction, offers personal freedom, promotes innovation, paves ways of generating wealth.
Characteristics of an entrepreneur
Confident, hard-working, well organized, and self-starters.
Disadvantages of being an entrepreneur
Very long hours. Low salary in the beginning. Job stability relies on the success of the business.
Human capital
Personal attributes that are considered useful in the production process
Gross pay
The total amount of money a worker earns before any deductions are made.
Net pay
The amount left after all deductions are taken out of the gross income.
Paycheck - mandatory deductions (who pay)
Taken from an employee’s paycheck. To fund Social Security and Medicare programs.
FICA (what is stands for)
Federal Insurance Contributions Act.
Itemized deductions
Requires that you list out specific things to recieve tax deductions on (like real estate, losses)
Standard deductions
Do NOT require a seperate itemized form (details) to receive the tax deductions.
Income
The money you receive in exchange for your labor or products.
Median Pay
The pay in the middle.
Check cashing store
Allows customers to cash checks, send wire transfers (electronic transfers of money from one financial institution to another) and purchases money orders (pre-paid paper documents, other than checks, used for payments).
Payday Loan store
Offer customers loans for small amounts of money that must be repaid by the borrowers next payday.
Bank
Offers customers checking and savings accounts that are insured by the federal government; longer-term loans; home mortgages; credit cards; and retirement and investment accounts.
Credit Union
a nonprofit-making money cooperative whose members can borrow from pooled deposits at low interest rates.
Insurance
A means of protection from financial loss
Why people buy insurance
To reduce the potential problems that risks may cause.
Premium
The amount you’re charged for your insurance policy
Writing a check - what should be included
The current date, the name of the person or company receiving the check, the amount of the check in numbers, the amount of the check in words, your signed name.
Check register
A check register is a record of your checking account transactions that helps you track your balance and everyday expenses.
Bank statement
Statement that summarizes the activity of your checking account including deposits, checks written, service charges, debit card & ATM activity , and any interest earned.
Deposit slips
A paper form that a bank customer includes when depositing funds into a bank account.
FDIC
Federal Deposit Insurance Corporation, an independent government agency that protects bank customers in the event of a bank failure.
Credit card
A type of loan that allows the cardholder to “buy now and pay later” up to an approved credit limit. Allows customers to complete basic transactions without the aid of a bank teller.
ATM
Allows you to conveniently deposit, withdraw, or transfer funds from your account and to verify you account balance.
Wire transfer
An electronic movement of money from one financial institution to another Allows people to quickly and safely transfer money around the world, but the user will pay a fee.
Credit
Allows people to obtain the use of money that they do not have.
Interest
Money paid regularly, at a particular rate for the use of borrowed money
Types of credit
Home mortgage, car loan, personal loan, credit card
Credit report
A record of your credit history.
Credit score
A number assigned to you indicating your ability to repay a loan.
Principal
The amount you borrow.
APR - what is it, what does it stand for
The rate you pay in a single year on the money you borrow. Stands for annual percentage rate.
Postsecondary opportunities
Higher education
Scholarships - costs/benefits
Cost: Applications can take considerable time and are not guaranteed. Benefits: Do not have to be paid back, offered by many institutions.
Credit cards - Benefits
Convenient to use and useful in an emergency, provide a record of charges. Great way to build your credit score. Protected on purchases.
Credit Card - Fees
May have relatively high interest rates, card holders may borrow more than their income should allow.
Investment
An asset or item acquired to generate income or gain appreciation.
Scams
Banking, Charity, Tickets, Lottery or Sweepstake, Government Grant, Identity Theft, Telephone Scams, Dating, Internet.
Stocks
A share of the ownership of the company.
Bonds
Financial instruments that represent loans to companies or governments.
Diversification
The attempt to reduce risk by spreading your assists classes and investments.
Benefits of saving
Saving builds wealth, enabling you to buy goods and services in the future-[perhaps a car, a college education, a house, a vacation.
Saving
Income not spent
Entrepreneur
Uses their skills to launch a new business
Risk
Refers to the degree of uncertainty and potential financial loss in an investment decision.
Finance charge
Refers to any cost related to borrowing money, obtaining credit, or paying off loan obligations.
