Basic Economics and Finance
This is the proportion of a loan that is charged as to the borrower, typically expressed as an annual percentage of the loan outstanding.
What is an interest rate?
This is the percentage of income that a person saves or invests, as opposed to spending.
What is the savings rate?
The portion of ownership in a company represented by shares of stock.
What is equity?
The value of a country’s currency rate to another country is known as _________.
What is the exchange rate?
“________” is when you spread your money across a number of different (largely unrelated) investments to reduce risk.
What is Diversification?
This financial statement shows a company's assets, liabilities, and shareholders' equity at a specific point in time.
What is a balance sheet?
This three-digit number, typically ranging from 300 to 850, represents an individual's creditworthiness and financial risk to lenders.
What is a credit score?
This decentralized digital asset, secured by cryptography and recorded on a public ledger called a blockchain, enables peer‑to‑peer transactions without a central bank.
What is cryptocurrency?
This term refers to the difference between a country's imports and exports.
What is the trade balance?
This event is when a private company first sells shares of its stock to the general public, transitioning from private to public ownership, usually to raise significant capital for growth, pay off debt, and increase visibility, while also allowing early investors to cash out.
What is an initial public offering?
This term refers to how easily an asset becomes cash without losing value; examples range from cash, checking accounts, major stocks/ETFs to real estate, art, private businesses.
What is liquidity?
A fixed amount paid by an individual to an insurance company in exchange for coverage.
What is a premium?
This decentralized, digital ledger securely records transactions across a network of computers grouped into “blocks.”
What is the Blockchain?
A record of all transactions between a country and the rest of the world, consisting of the current account (trade) and capital account (investments).
What is Balance of Payments (BoP)?
"_________" arises from the fluctuations in the market that affects all investments, like changes in interest rates or economic recessions.
What is systemic risk?
This type of private investment pool is for institutional and accredited investors, aiming to generate high, positive returns in all market conditions.
What is a hedge fund?
This is something pledged as security for repayment of a loan, to be forfeited in the event of a default (failure to repay).
What is collateral?
This market is where stocks, bonds, and other securities are bought and sold by investors, and the prices fluctuate based on supply and demand.
What is the stock market?
This international organization promotes global monetary cooperation and financial stability, often providing emergency loans to countries facing balance of payments crises.
What is the International Monetary Fund?
These contracts give the holder the right, but not the obligation, to buy (call) or sell (put) shares of a company's stock at a set price (strike price) before an expiration date.
What is a stock option?
This type of market is where financial assets like stocks and bonds are bought and sold after they are initially issued in the primary market.
What is the secondary market?
This type of account, offered by banks and credit unions, typically requires a higher minimum balance and often restricts withdrawals. It pays a higher interest rate compared to a regular savings account and is considered a low-risk investment.
What is a certificate of deposit (CD)?
This measure indicates the value of a company based on its current stock price multiplied by its total number of outstanding shares.
What is market capitalization?
Formed in 1960, this organization of mostly high-income democracies conducts economic research, sets policy standards, and publishes widely cited reports comparing member countries’ economic performance.
What is the Organisation for Economic Co-operation and Development?
This financial marketplace is for trading contracts whose value is derived from an underlying asset, benchmark, or group of assets like stocks, commodities, currencies, or interest rates, allowing users to hedge risk, speculate on price movements, or leverage positions without owning the asset itself.
What is the derivatives market?