Finance Flashcards

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Administrative law

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Ensure that government agencies act within their legal authority, protect citizens' rights, and promote accountability, fairness, and efficiency in the enforcement of regulations.

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Fiduciary

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Someone obligated to act in the best interest of another party, prioritizing their interests above their own.

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Luxury tax

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An extra charge on expensive, non-essential items like high-end cars or jewelry, aimed at wealthier buyers to raise government funds.

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Ponzi scheme

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A type of fraudulent investment scam in which returns are paid to earlier investors using the capital from new investors, rather than from profit earned by the operation.

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Future Value

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The amount of money an investment will grow to over time, considering interest or growth.

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Simple Interest Formula

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FV = P * (1+r*t). P = initial investment (principal), r = annual interest rate, t = time (in years).

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Compound Interest Formula

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FV = P * (1+r/n)^n*t. P = principal, r = annual interest rate, n = number of compounding periods per year, t = time (in years).

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Layaway plan

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A payment option that allows a customer to reserve a product by making a series of installment payments over time, rather than paying the full amount upfront.

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Virtual audit

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A remote examination of a company's financial records and operations using digital tools, allowing auditors to review documents and conduct assessments online.

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Traditional audit

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An in-person examination of a company’s financial records and operations conducted by auditors to assess accuracy, compliance, and internal controls.