Budgeting & Personal Finance
What is the Envelope System?
A budget system where people organize cash into different spending categories to control spending
Define Fiscal Policy.
How the government collects and spends money
What are Equities?
Stocks
What is a Progressive Tax?
A tax that takes into account a person's income when deterring the rate they pay
Consumers create _________
demand
Explain the Zero-Based Budget.
All money every month should be accounted for, no money left over
What is Monetary Policy?
How the government controls how much money is in the economy at a given time
What is Diversification?
Spreading your investment out over multiple industries and companies to lessen your level of risk
What is an Excise Tax?
A tax set on a specific good or service
What is the paradox of value?
Describe the 50/20/30 Budget Rule.
50% for needs, 30% for wants, and 20% for savings
What is a Budget Deficit?
When the government spends more money than it collects
What is a Mutual Fund?
A diversified collection of stocks and bonds someone else manages for you
Define Regressive Tax.
A tax that costs lower income people more than higher income people
What type of economic system does the United States have?
Mixed economic system.
What does "Pay Yourself First" mean?
You put money into your savings account before you do any other budgeting
What is the Discount Rate?
The interest rate the Federal Reserve charges banks to borrow money
What is Day Trading?
Making multiple trades in a single day with the goal of making as much money as possible.
What is a User Fee?
A fee collected for the government for a person who is utilizing a specific government service
What is Opportunity Cost?
the value of what you're giving up when you choose one option over another
What are conative biases when it comes to personal finance
irrational thought process that impacts how we spend our money
What government entity is in charge of fiscal policy, and which entity is in charge of monetary policy
The Federal Reserve and the Congress
What government entity regulates the stock market
The SEC
What is a tax on imported goods cost
Tariff
Land, labor, capital, and entrepreneurship are the four factors of _________
production