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125 Cards in this Set
- Front
- Back
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Government Securities
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Securities offered and insured by the federal government, include treasury bills, notes, and bounds
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Grace Period (Credit)
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Time in which no interest is charged or no late payments are assessed on a credit account
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Gross Domestic Product (GDP)
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A macroeconomic indicator that calculates the value of goods and services produced throughout a nation
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High Quality Corporate Securities
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Stocks, bonds, and mutual funds that are issued by companies with a long history of favorable returns and growth
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Incentive
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Rewards or penalties that encourage choices that help consumers reach their financial and non-financial goals
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Income
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Payment received as a result of investments, interest, or work
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Inflation
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A general rise in prices of goods and services that reduces the purchasing power of money
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Insurance
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A risk management tool that protects an indvidual from financial loss, generally in the form of a policy with premium and/or deductible payments
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Interest
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The cost of borrowing and lending money:
1. Payment received by an investor from a financial institution as a resutl of an investment or savings.2 A percentage of the loan amount borrowed by a consumer paid back to the lender |
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Interest Rate
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A perecentage of the principle amount that serves as the cost of using that moeny
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Investing
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Money spent to increase current and/or future income; not insured against loss that rises and falls with the investment market.
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Investment Objectives (Mutual Fund)
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Categorizes the type of investments that comprise the fund
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Law of Demand
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Economic governing principle that suggets an inverse relationship exists between demand of a product or service
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Law of Supply
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Economic governing principle that suggets as cost increases, the quantity supplied to buyers also rises
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Lender
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An individual, organization, or company that extends credit to a borrower with the expectation that the amount will be paid back over time
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Liability/ Liabilities
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The dolar value of debts owed to others
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Limited Resources
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Available resources are inadequate to satisfy all needs and wants
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Liquidity
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The ease with which an investment can be converted into cash without a loss to principal
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Load Fund
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A mutual fund that charges a sales commission (load)
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Loan Period
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Time period in which a loan must be repaid, usually in years
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Long Term Goal
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Goal that will take more than one year to achieve
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Macroeconomics
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Study of the economy-at-large including overall income, growth, inflation, and employment rates
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Management Fees
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Fees charged to mutual fund investors that cover the maintenance and marketing costs of that fund
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Market Economy
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An economic system where people own and operate businesses
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Market Volatility
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Fluctuations in the price and value of securities that results in gains and losses of capital
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Markets
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A meeting place for buyers and sellers to exchange goods and services
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Microeconomics
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The study of small components of a regional, national, or global economy. Components may include individuals, households, or businesses.
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Minimum Monthly Payment
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Smallest amount of money accepted by the creditor each billing cycle to keep an account in good standing
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Miscellaneous Fees (Credit Accounts)
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Additional fees charged a borrower for use of credit inculding late fes, annual fees, over the limit fees, bounced check fees, etc.
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Mixed Economy
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An economic system that has some aspects of a command economy and some aspects of a market economy
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Monetary Policy
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National policy set forth by the Federal Reserve System that affects all aspects of moeny, including the availability of money and the cost of credit
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Money Market Mutual Fund
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A low risk mutual fund that invests in stable, short-term securities
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National Association of Securities Dealers (NASD)
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A self-regulatory organization that operates and regulates the Nasdaq Stock Market and oversees the activities of the US broker-dealer profession
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National Assocation of Securities Dealers Automated Quotation (NASDAQ)
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A computerized system that allws brokers to trade stocks electronically
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National Association of Securities Dealers Regulators (NASD-R)
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The branch of NASD that imposes standards of fair practice on its members and takes disciplinary action against members who violate its rules
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National Futures Assocation
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A self-regulatory agency for the futures market committed to protecting the rights of investors in the futures market
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National Credit Union Association (NCUA)
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A federal govenrmeny agency created to guarantee credit union depsosts
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Need
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Those things that are essental to human existance
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Net Asset Value (NAV)
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The current market value of a mutual fund's portfolio divided by the nubmer of shares equals NAV/share. Calculated at least one time every business day
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Net Worth
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A person's financial condition at a given time. Assets (things owned) minuse liabilities (things owned) equals net worth
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No-Load Fund (NL)
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A mutual fund purchased directly from the fund and does not have a sales charge
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New York Stock Exchange (NYSE)
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Oldest stock market in the United States that oversees daily trading in over two thousand stocks involoving millions of shares
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Annual Percentage Rate (APR)
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Yearly interest rate charged on a credit account
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Aggressive Growth Securities
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Stocks, bonds, and mutual funds that have capital growth as their main objective
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Asset
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Item owned by an individual or organization that has monetary value
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Asset Allocation
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Strategy for selecting various investment vehicles in order to spread risk among stocks, bonds, and cash equivalents
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Bank
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A financial institution that serves as a storehouse of funds for borrowing, lending, selling, and holding
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Benefits
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Positive outcomes that result from a choice or decision
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Blue Sky Laws
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State laws that govern the offer and sale of securities to residents of that state.
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Bond
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Certificate representing loan of moeny for a specific period, in exchange for a promise to repay the amount borrowed with interest by the government or a corporation
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Borrower
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Individual who uses another's money for current use with a promise to repay that amount from future income or earnings
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Capital Gains
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At the time of redemption, the value of a security increases from this original purchase price
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Capital Loss
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At the time of redemption, the value of a security drops from its original purchase price
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Cash Advance
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Cash received on a credit line at a higher interest rate
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Caveat emptor
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Latin phrase meaning "Let the buyer beware."
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Certificate of Deposit
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Saving tool purchased for a specific dollar amount at a fixed interest rate for a specific time period
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Choices
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Possible alternatives or options; the best option under a given circumstance
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Collectibles
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Physical objects such as fine art, stamps, antiques that are purchased as an investment
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Command Economy
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An economic system in which all decisions concerning production of goods and services are made by the government and all resources are owned by the government
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Commission
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Broker or agent fee for carrying out a transaction
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Commodity Futures Trading Commission
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Regulatory organization for future contracts and commodities
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Compound Interst
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Interest earned on principal plus previously accrued interst
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Consumer
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An individual who buys or uses products or resources
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Costs (decision making)
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Negative outcomes that result from a decision
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Credit
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Borrowing money now with a promise to pay it back at a later time, generally with interest
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Credit Limit
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The maximum amount of credit available on a credit account
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Decision
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A chouce made from available options
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Decision Making
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Process used to determine the best possible choice at a given time based on available information and resources
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Demand
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The quantity of goods consumers purchase in a given time period.
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Discount Broker
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Financial professional who executes securities transactions with little or no individual advicre and therefore charges a low commission.
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Diversification
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Strategy for reducing risk by spreading investment money among several investment types and industries
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Dividend
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Earnings on stock paid to shareholders by corporations
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Dollar-Cost Averaging
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Investing the asme fixed dollar amoutn in the same investment at regular invtervals over a long period of time regardless of price
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Dow Joans Industrial Average (DJIA)
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A market indicator that averages blue chip US stocks in different categories
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Economic Growth
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A time of gerneal rise in a regiouns economy. During economic growth, more goods and services are produced, more jobs are created, and income levels rise
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Economic Indicators
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Regularly reported statistics that evaluate business conditions and economic trends. Some of these statistics include employment, stock prices, money supply, and consumer confidence
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Economics
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The study of management, distribution, and consumption of goods and services
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Economy
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A system of regulations and rules by which a country's productio nand consumption activity are managed
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Employer-Sponsered Retirement Plan
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A saving/investment plan approved by the Internal Revenue Service (IRS) that allows an individual to place funds in a tax-sheltered accoutn for the purpose of funding all or part of one's retirement
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Entrepreneur
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Individual who establishes, maintains, and assumes the rsik of a business operation
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Ethics
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Beliefs that govern an individual or community's actions
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Exchange
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Central location where buyers and sellers unite to execute transactions
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Expense
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An outflow of money
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FDIC (Federal Deposit Insurance Corporation)
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Agency of the federal government created to guarantee bank deposits
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Federal Reserve System (Fed)
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Sets forth economic policies that effect the nation as a whole. The Fed maintains accounts for government accounts for government agencies, regulates the buying and selling of government securities, lends money to banks, monitors and audits banks, control the circulatio nof money, and many other tasks
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Financial Advisor
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A professional who provides financial information and advice. May include an employee benefits staff member, credit counselor, bank employee, broker, financial planner, accountant, insurance agent or attorney
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Financial Institution
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Entities that provide financial services. Usually refers to banks, credit unions, brokerage houses, savings, and loan institutions
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Financial Market
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Markets consisting of exchanges that serve as a central location where buyers and sellers get together in person, by telephone, or by computer terminal to trade stocks, bonds, commodities, options, futures contracts, and other securities
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Financial Plan
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A systematic course of action for identifying financial goals, figuring net worth, estimating income and expenses, and using credit wisely.
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Fraud
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The use of intentional misrepresentation of truth for illegal gain
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Free Enterprise System
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An economic system that allows anyone to start a business provided they have the resources to do so.
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Opportunity Cost
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The next most valued alternatives tha twill be given up as a result of choosing another option
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Over the Limit Fee
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Charge for exceeding the credit line on an account
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Pay Yourself First
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An established amount saved each payday and put into savings rather than immediately spending the money
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Ponzi Scheme
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An illegal investment scam named for its inventor, Charles Ponzi.
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Portfolio
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Collection of investments held by an individual or organization
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Private Company
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A company owned exclusively by an individual, family, or small group of people.
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Price
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Monetary value at which a good or service is bought or sold
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Prospectus
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Legal document that details an investment company, including fund operations, investment objectives, fees, and earnings record
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Public Company
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A corporation that sells shares of ownership in the company to the general public
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Pyramid Scheme
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Fraudulent scheme where an investor buys the right to be a sales representative for a "product." Those in the scheme early may profit; those in late always lose.
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Real Estate
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Phsyical property owned for the purpose of investment, including rental property, personal property, or business property.
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Return
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Total increase or decrease of an investment; includes income plus capital gains or minus capital losses.
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Risk (investment)
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The possibility that an investment will lose value
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Risk/ Return Relationship
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Assumption that greater uncertainty equates higher gain and that less uncertainty equates lower gain on an investment.
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Role of Government
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Parameters established for the government to take action and intervene for the common good of its citizens
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Savings
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Income withheld from current spending for future use.
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Savings Account
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Account used to set aside income for easy withdrawal and to accrue interest
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Scarcity, Scarce
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Condition in which resources are insufficient to fulfill consumer wants.
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Securities and Exchange Commission (SEC)
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Independent federal agency that governs the securities industry and enforces securities laws.
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Short-Term Goal
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Goal that will be achieved within one year.
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Simple Interest
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A percentage of the principal amount only.
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State Securities Regulator
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Government officer who handles the licensing, registration, and regulation of stockbrokers and financial advisors that do business in a specified state.
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Stock
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An investment that represents shares of ownership and entitles the investor to a portion of the company earnings
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Stockbroker
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A financial representative who handles the buying and selling of securities.
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Stock Market
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Market in which sellers of stock trade shares with buyers of stock.
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Stock Symbol
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Abbreviation of a comany name; used to simplify reporting on stock reports (also called ticker symbol or stock abbreviation).
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Supply
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The amount of products or services that a producer is able to make available to consumers at a given time.
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Swindler
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Individual who engages in fraudulent practices for illegal gain.
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Tax-Deferred
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Deposits made to an account are taxed upon withdrawal.
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Time Value of Money
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Concept that an initial investment made early in life will accrue more interest thatn a series of deposits made later in life (due to compounding, time, rate of interest and amount invested).
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Trade-Off
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Something foregone by choosing one option over another.
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Transaction Costs (Investment)
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Fee charged by a broker to buy or sell investment products.
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Values
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Concepts important to an individual that provide a foundation upon which decisions are made.
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Want
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Things that are not necessary for sustaining life but that make one's life more comfortable
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