Vocabulary

• Inflation – The rate at which the general level of prices for goods and services is rising and, subsequently, purchasing power is falling.
• Savings – The portion of disposable income not spent on consumption of goods and services.
• Interest Rate – The amount charged, expressed as a percentage of the principal, by a lender to a borrower for the use of assets.
• Purchasing Power – The value of a currency expressed in terms of the number of goods or services that one unit of money can buy.
• Disposable Income – The amount of net income remaining after all taxes have been deducted.
• Consumer Price Index (CPI) – A measure that examines the weighted average of prices of a basket of consumer goods and services.
• Deflation – The decrease in the general price level of goods and services, often caused by a reduction in the supply of money or credit.
• Hyperinflation – An extremely high and typically accelerating inflation.
• Principal – The original sum of money borrowed in a loan, or put into an investment.
• Asset – A resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide a future benefit.
• Liability – A company's financial debt or obligations that arise during the course of its business operations.
• Investment – The action or process of investing money for profit or material result.
• Capital – Wealth in the form of money or other assets owned by a person or organization or available for a purpose such as starting a company or investing.
• Currency – A system of money in general use in a particular country.
• Debt – Money owed or due.
• Credit – The ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.
• Equity – The value of an asset after all liabilities are subtracted.
• Revenue – Income that a business has from its normal business activities, usually from the sale of goods and services to customers.
• Expense – The cost required for something; the money spent on something.
• Profit – A financial gain, especially the difference between the amount earned and the amount spent in buying, operating, or producing something.
• Loss – The amount of money lost by a business or organization.
• Budget – An estimate of income and expenditure for a set period of time.
• Financial Market – A marketplace where buyers and sellers trade assets such as equities, bonds, currencies, derivatives, and commodities.
• Securities – A tradable financial asset.
• Bonds – A fixed income instrument that represents a loan made by an investor to a borrower.
• Stocks – A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings.
• Dividends – A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.
• Portfolio – A range of investments held by a person or organization.
• Financial Institutions – Institutions that provide financial services for its clients or members.
• Bank – A financial institution licensed to receive deposits and make loans.
• Insurance – A contract, represented by a policy, in which an individual or entity receives financial protection or reimbursement against losses.
• Risk – A situation involving exposure to danger or potential loss.
• Return – The gain or loss made on an investment.
• Money Supply – The total amount of monetary assets available in an economy at a specific time.
• Federal Reserve – The central banking system of the United States.
• Monetary Policy – The macroeconomic policy laid down by the central bank, involving the management of money supply and interest rate.
• Fiscal Policy – The use of government revenue collection and expenditure to influence a country's economy.
• Exchange Rate – The value of one currency for the purpose of conversion to another.
• Trade Deficit – The amount by which a country's imports exceeds the value of its exports.
• Trade Surplus – The amount by which the value of a country's exports exceeds the value of its imports.
• Recession – A period of temporary economic decline during which trade and industrial activity are reduced.
• Economic Growth – An increase in the inflation-adjusted market value of the goods and services produced by an economy over time.
• Gross Domestic Product (GDP) – The total value of goods produced and services provided in a country during one year.
• Unemployment Rate – The measure of the prevalence of unemployment and it is calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labor force.
• Salary – A fixed regular payment, typically paid on a monthly or biweekly basis, made by an employer to an employee.
• Wage – A fixed regular payment, typically paid on a daily or weekly basis, made by an employer to an employee.
• Pension – A regular payment made during a person's retirement from an investment fund to which that person or their employer has contributed during their working life.
• Tax – A compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.
• Import – A commodity, article, or service brought in from abroad for sale.
• Export – A commodity, article, or service sold abroad.