Chapter 2 - Personal Finance

Question 1

Bankrupt

Answer 1

when a person is judged by a court to be insolvent (unable to pay her or his debts)

Question 2

Cash Flow

Answer 2

money coming into and going out of a business

Question 3

Commission

Answer 3

the percentage of a sales price received by a salesperson for her or his services.

Question 4

Credit Bureau

Answer 4

an organisation that keeps on file the credit records of consumers

Question 5

Creditor

Answer 5

a person who is owed money

Question 6

Debtor

Answer 6

a person who owes money

Question 7

Default Notice

Answer 7

a document from a lender stating that a person has failed to carry out the terms of the contract.

Question 8

dividend

Answer 8

sum payable as profit from shares

Question 9

equities

Answer 9

stock and shares held by an individual

Question 10

fee

Answer 10

money paid to others for their services

Question 11

fixed expenses

Answer 11

expenses that are the same every time

Question 12

garnished

Answer 12

when a certain amount of money can be taken out of a borrower’s wages. e.g.in divorce

Question 13

guarantor

Answer 13

someone who guarantees to payback the money if the borrower does not

Question 14

impulse buying

Answer 14

buying something without giving much thought as to whether you really need it.

Question 15

income

Answer 15

money received on a regular basis from work, property, business, investment, or welfare payments

Question 16

interest

Answer 16

a payment made for the use of money that has been borrowed

Question 17

investment

Answer 17

putting money into something in order to make a profit

Question 18

mortgage

Answer 18

a loan for goods or a property

Question 19

net income

Answer 19

the amount a person has left after income tax is deducted

Question 20

overtime

Answer 20

time during which work is done outside regular working hours. Such time is usually paid at higher rates.

Question 21

portfolio

Answer 21

a range of low-risk and high-risk financial investments

Question 22

premium

Answer 22

the amount of money to be paid to receive insurance cover

Question 23

profit

Answer 23

what remains after all business expenses are deducted from sales revenue

Question 24

rent

Answer 24

regular payment made by a tenant to an owner for the use of the owner’s building or land

Question 25

repossess

Answer 25

to take back goods bought on credit if repayments have not been made

Question 26

royalty

Answer 26

a sum paid to authors, musicians and so on, as a percentage of the proceeds from their work.

Question 27

salary

Answer 27

a fixed amount of money paid on a regular basis (usually fortnightly or monthly) to a permanent employee of an organisation.

Question 28

savings plan

Answer 28

a commitment to regularly put aside some money for future us

Question 29

secured loan

Answer 29

something deposited as a guarantee to fulfil the payment of a loan

Question 30

social welfare payment

Answer 30

a payment made by a government to help people in need

Question 31

superannuation

Answer 31

a way of saving so an employee has some money in retirement

Question 32

unsecured loan

Answer 32

nothing is deposited as a guarantee to fulfil the payment of the loan

Question 33

variable expenses

Answer 33

expenses that change over time

Question 34

wage

Answer 34

money received by workers, usually on a weekly basis, for services they provide the provide to an employer