Unit 1 Topic 2 - Personal Finances and The economy Flashcards
Define austerity.
A government measure to reduce the amount of money it spends (usually reduced wages and benefits), resulting in difficult financial conditions for a population
What are benefits?
Money and other financial support (such as reduced bus and train fares or provision of housing) that the government provides for people who are unable to get any other income.
Define bonds.
A certificate that shows you have bought the debt from a company or the government, in return for which the company or government pays a fixed amount of money in interest each year.
What is a budget?
A plan for how you will use your income, including spending and saving. Charity – (1) an organization set up to help a particular group or issue; (2) the act of donating money or time to a cause.
What is a consumer?
Someone who uses or buys goods and services.
Define debt.
Money owed to another person or organization such as a bank.
Define deficit.
more expenditure than income; more money paid out than coming in.
What is disposable income?
The money that is left over from your income after you have paid all of your expenses and have put any savings aside.
What are earnings?
The money that you make from your job.
What is the economy?
The state of a country relating to the amount of money that is in the system and the production and consumption of goods and services.
What are expenses?
The things that you have to spend your income on. Fiscal policy – the decisions a government makes about taxes and what to spend public money on.
What is a gilt?
A high-interest, very secure government bond (see ‘Bonds’). Income tax – money deducted from your income by the government to pay for public services such as health and education.
Define income.
All the money (or items worth money) that you receive, including through work, investments and government benefits.
What is interest?
The money you pay as a charge for the service of using someone else’s money – for example, if you borrow money to buy a car, you pay back the money you borrowed plus interest; or the bank pays you interest on money saved as it has access to your money.
What is an investment?
Something that you buy because it is likely to make you money in the future – for example, property may increase in value so that you can sell it for more than you bought it and make a profit, or you can rent it out.
