RC Ch. 3 Vocab

Front

Emergency fund:

Back

A savings account for financial emergencies.

Front

Large purchase?

Back

A purchase that requires a significant amount of money.

Front

Interest rate definition

Back

Percentage of principal charged by the lender for using its money.

Front

Accrued interest?

Back

The amount of interest charged on a debt but not yet collected.

Front

Compound growth:

Back

Average growth rate of an investment over time, often annual.

Front

Compound interest

Back

Interest paid on interest previously earned

Front

Principal: initial amount invested or borrowed

Back

The initial amount of money invested or borrowed

Front

Rate of return: Measure of an investment's profit or loss, usually as a percentage of the initial investment.

Back

The measure of an investment's profit or loss, usually expressed as a percentage of the initial investment.

Front

Inflation:

Back

Persistent rise in the cost of goods and services over time.

Front

Time value of money

Back

An amount of money is worth more today than in the future due to earning potential.