Test Bank for Personal Finance, 2026
Evergreen Release by Jack Kapoor
Inflation - answer-the rise in the level of prices for goods and services
Time Value of Money - answer-the increase of an amount of money due to earned interest or
dividends
Balance Sheet - answer-statement that identifies the items you own, what you owe, and your
net worth
Paying Yourself First - answer-the concept of setting aside a portion of your income for savings
before spending any of it
Commission - answer-a fee charged by a brokerage firm or investment bank to buy or sell
securities of an investor
Potential Earning Power - answer-the amount of money you may earn over time
Finance Charge - answer-the total dollar amount of interest you pay to use credit
Compounding - answer-the process of earning interest on both the principal and any prior
interest earned in your account
Medicare - answer-is a government sponsored health care coverage for the elderly
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, Credit Limit - answer-The maximum dollar amount of money the creditor will make available to
you on your credit card
Medicaid - answer-is a government sponsored health care plan for people with low income
Grace Period - answer-the amount of time a credit card company provides before you incur
finance charges
Liquidity - answer-the ability to easily convert your financial resources into cash without loss of
value
Annual Percentage Yield - answer-term for the amount of interest that a $100 deposit would
earn after compounding for one year (as defined by law)
401(k) - answer-sets aside a portion of your pay, plus (usually) an employer match.
Economics - answer-The study of the decisions that go into making, distributing and using goods
and services.
Dealer Invoice Price - answer-Price the car dealer paid to purchase the car from the
manufacturer.
Opportunity Cost - answer-A trade-off or what you are giving up when you make one choice
over another.
Diversification - answer-A strategy of investing in a broad range and number of companies in
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Evergreen Release by Jack Kapoor
Inflation - answer-the rise in the level of prices for goods and services
Time Value of Money - answer-the increase of an amount of money due to earned interest or
dividends
Balance Sheet - answer-statement that identifies the items you own, what you owe, and your
net worth
Paying Yourself First - answer-the concept of setting aside a portion of your income for savings
before spending any of it
Commission - answer-a fee charged by a brokerage firm or investment bank to buy or sell
securities of an investor
Potential Earning Power - answer-the amount of money you may earn over time
Finance Charge - answer-the total dollar amount of interest you pay to use credit
Compounding - answer-the process of earning interest on both the principal and any prior
interest earned in your account
Medicare - answer-is a government sponsored health care coverage for the elderly
1
, Credit Limit - answer-The maximum dollar amount of money the creditor will make available to
you on your credit card
Medicaid - answer-is a government sponsored health care plan for people with low income
Grace Period - answer-the amount of time a credit card company provides before you incur
finance charges
Liquidity - answer-the ability to easily convert your financial resources into cash without loss of
value
Annual Percentage Yield - answer-term for the amount of interest that a $100 deposit would
earn after compounding for one year (as defined by law)
401(k) - answer-sets aside a portion of your pay, plus (usually) an employer match.
Economics - answer-The study of the decisions that go into making, distributing and using goods
and services.
Dealer Invoice Price - answer-Price the car dealer paid to purchase the car from the
manufacturer.
Opportunity Cost - answer-A trade-off or what you are giving up when you make one choice
over another.
Diversification - answer-A strategy of investing in a broad range and number of companies in
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