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Sources of Capital
vocab?
31
Economics
12th Grade
03/29/2012

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Term
disposable income
Definition
money available after taxes have been paid
Term
balance
Definition
amount of money in an account
Term
liquidity
Definition
assets can be converted into cash with little or no loss in interest payments
Term
time deposits
Definition
require saver to leave money in account for specific time
Term
maturity
Definition
length of time money must be deposited
Term
savings rate
Definition
percentage of people's disposable income that is not spent
Term
investment
Definition
occurs when people exchange money for something of value with expectation of earning profit in future
Term
budget
Definition
spending and saving plan.
Term
fixed expenses
Definition
payments that remain constant from month to month
Term
flexible expenses
Definition
can vary from month to month
Term
Diversification
Definition
a person can choose a variety of investments
Term
real investment
Definition
investors use money to create a new capital good
Term
capital accumulation
Definition
expansion of capital goods existing in an economy
Term
infrastructure
Definition
transportation systems including roads, bridges, harbors, and airports, and public facilities
Term
venture capital
Definition
money invested in entrepreneurial enterprises
Term
capital gain
Definition
difference between higher selling price and lower original purchase price
Term
stock split
Definition
split a share into two
Term
brokers
Definition
link buyers and sellers of stock
Term
investment bank
Definition
buys and sells large blocks of stock
Term
bull market
Definition
Dow rises over a period of time
Term
bear market
Definition
Dow falls over a period of time
Term
yields
Definition
interest on money owed to a bond holder
Term
futures
Definition
instead of trading stock, investors trade various types of products
Term
prospectus
Definition
fact sheet containing data on company's finances
Term
installments
Definition
principal and interest are divided into equal amounts
Term
credit rating
Definition
estimation of probability of repayment
Term
credit bureau
Definition
credit reporting service
Term
finance charge
Definition
total cost of credit expressed in dollars and cents
Term
annual percentage rate
Definition
total cost of credit expressed as a yearly percentage
Term
usury
Definition
charging interest above the limit
Term
bankruptcy
Definition
legal declaration of inability to pay debts
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