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genmath > TERMS > Flashcards

TERMS Flashcards

1
Q

interest that is computed on the principal. The interest remains constant throughout the term.

A

Simple Interest

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2
Q
  • interest on savings calculated on both the initial principal and the accumulated interest from previous periods.
A

Compound Interest

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3
Q

person (or institution) who invests the money or makes the funds available.

A

Lender or Creditor

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4
Q

person (or institution) who owes the money or avails of the funds from the lender.

A

Borrower or Debtor

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5
Q

date on which money is received by the borrower.

A

Origin or Loan Date

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6
Q

date on which the money borrowed, or loan is to be completely repaid.

A

Repayment Date or Maturity Date

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7
Q

amount of time in years the money is borrowed or invested, length of time between the origin and maturity dates.

A

Time or Term (t)

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8
Q

amount of money borrowed or invested on the origin date.

A

Principal (P)

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9
Q

annual rate, usually in percent, charged by the lender, or rate of increase of the investment.

A

Rate (r)

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10
Q
  • amount paid or earned for the use of money.
A

Interest (I)

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11
Q

amount after t years that the lender receives from the borrower on the maturity date.

A

Maturity Value or Future Value (F)

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12
Q

Based on 30-day per month computation.

A

Ordinary Time

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13
Q

Based on the exact number of inclusive days of the month.

A

Exact Time

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14
Q

The present value or principal of the maturity value (F) due in t years at any rate r can be obtained from the maturity value formula.

A

The Present Value at Compound Interest

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15
Q

also called maturity value, it is an accumulated amount obtained by adding the principal and the compound interest.

A

Compound Amount (F)

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16
Q

number of conversion periods in a year.

A

Frequency of Conversion (m)

17
Q

time between successive conversions of interest.

A

Conversion or Interest Period (t)

18
Q

the total number of times an interest is calculated over the term. n = mt

A

Number of Conversion Periods (n)

19
Q

simply the distribution of the specified annual rate (rate per year) to the frequency of conversion.

A

Rate (j) of Interest for each Conversion Period

20
Q

a sequence of payments made at equal (fixed) intervals or period.

A

Annuity-

21
Q

time between the first payment interval and last payment interval

A

Term of an Annuity (t)

22
Q

the amount of each payment.

A

Regular Payment/ Periodic Payment (R)

23
Q

sum of future values of all the payments to be made during the entire term of the annuity.

A

Amount of an Annuity/ Future Value (F)

24
Q

sum of present values of all the payments to be made during the entire term of the annuity.

A

Present Value of an Annuity (P)

25
Q

is equal to the down payment (if there is any) plus the present value of the installment payments.

A

Cash Value or Cash Price

26
Q

the stated rate of interest per year.

A

ANNUAL INTERST RATE OR NOMINAL RATE

27
Q

annuity where the payment interval is the same as the interest period.

A

Simple Annuity- (Payment interval and interest period)

28
Q

annuity where the payment interval is not the same as the interest period.

A

General Annuity- (Payment interval and interest period)

29
Q

annuity in which the payments are made at the end of each payment interval.

A

Ordinary Annuity (Annuity Immediate)- (Time of payment)

30
Q

annuity in which the payments are made at the beginning of each payment interval.

A

Annuity Due- (Time of payment)

31
Q

annuity in which payments begin and end at definite times.

A

Annuity Certain- (Duration)

32
Q

annuity in which the payments extend over an indefinite length of time.

A

Contingent Annuity- (Duration)

genmath (2 decks)

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