Quantative Reasoning 4A-4D Definitions

Bond

A ____ represents a promise of future cash.

Stock

A _____ gives you a share of ownership in a company.

Principal

For any loan, the _________ is the amount of money owed at any particular time.

Capital Gain

If you sell a stock for more than you paid for it, you have a _______ ____.

Compound Interest

Interest paid both on the original principal and on all interest that has been added to the original principal.

Simple Interest

Interest paid only on the original principal, and not on any interest added at a later date.

APY (Annual Percentage Yield)

The ___ is the actual percentage by which a balance increases in 1 year.

Principal

The _________ in financial formulas is the balance upon which interest is paid.

Annual Return

The average annual percentage yield (APY) that would give the same overall growth is the ______ ______.

Total Return

The relative change in the investment value is the _____ ______.

Credit Card

______ ____ loans differ from installment loans in that you are not required to pay off your balance on any set period of time.