Topic 2

Question 1

Annual exempt amount

Answer 1

the annual tax-free allowance for capital gains tax

Question 2

Annuity

Answer 2

a financial product that pays a regular guaranteed income ,in return for a lump sum

Question 3

Assets

Answer 3

things that a person or business owns

Question 4

Bonds

Answer 4

see cooperate bond , government bond and saving bond

Question 5

capital gains tax

Answer 5

tax payable on the gain made when you sell or give away an asset

Question 6

capital growth

Answer 6

an increase in the market value of an investment

Question 7

capital sum

Answer 7

the total amount borrowed or saved / invested , before the addition of interest

Question 8

commodity

Answer 8

goods that share the characteristics wherever they are produced and whoever produced them

Question 9

corporate bond

Answer 9

a product that companies can use to borrow money over periods of five years or more

Question 10

corporation tax

Answer 10

a tex levied on the taxable profits of limited companies and some other organisations

Question 11

diversification

Answer 11

spreading investment across a range of different products , funds or types of asset so as to reduce the potential impact of any doing particularly badly

Question 12

dividend

Answer 12

a payment of profits from a company to its shareholders often at twice -yearly intervals

Question 13

endowment policy

Answer 13

an insurance product that pays our a lump sum after a specified term or if the insured person dies before