Banking Flashcard

Front

What is an emergency fund?

Back

A savings account set aside for unexpected situations.

Front

Find the simple interest paid on a deposit of $225 at a rate of 1.5% over 2 years.

Back

$6.75

Front

Find the simple interest paid on a loan of $1,500 at a rate of 19% for 15 months.

Back

$356.25

Front

Why shouldn't we invest our emergency fund or other short-term savings?

Back

Investments are risky and can drop in value, especially in the short term.

Front

If we're trying to fund an expense that's 2 years away (FEWER than 3-5 years), should we save or invest?

Back

SAVE

Front

Find the simple interest earned for a principal of $2,000 at an 8% rate for 5 years.

Back

$800

Front

If we're trying to fund an expense that's 15 years away (MORE than 3-5 years), should we save or invest?

Back

INVEST

Front

The cost of borrowed money, usually expressed as a percentage.

Back

interest

Front

Starting money = $350.
Interest rate = 2.5%
Time = 3 years.
How much interest?

Back

$26.25

Front

Find the simple interest paid on a loan of $750 with an 18% rate over 2 years.

Back

$270