Financial Literacy

a global economy and foreign competition

American consumers spend dollars on goods and services. The goods and services are manufactured or offered by American companies and companies from other countries. This is an example of:

having enough money to fund retirement and pay for current expenses

Examples of opportunity costs do NOT include:

interest is earned on previously earned interest

Future value computations are often referred to as compounding, as _____.

Through borrowing, interest rates, and buying and selling of government bonds

How is the money supply maintained by the Federal Reserve?

opportunity costs

Paul can invest his money in the stock market now instead of buying a new car; however, that would require a trade-off or:

$200

Paul invested $185. The interest earned is 4%, compounded annually. At the end of two years, Paul will have about:

achieve your goals satisfy your personal values meet your needs

Personal opportunity costs include using your time, in addition to or in place of money, to

$220

Sam has an investment of $200 that is expected to earn 10% annually. How much will the investment be worth at the end of the first year if the investment earns simple interest?

personal opportunity costs

Selecting your time rather than your money to meet your needs, achieve your goals and satisfy your personal values are examples of:

buying and selling government securities controlling interest rates

The Fed influences the money supply by:

economic

The ____________ environment includes various institutions, including businesses, labor, and government, that work together to satisfy needs and wants.

future value

The amount to which current savings will increase based on a certain interest rate and a certain time period is called:

length of time principal amount annual interest rate

To calculate time value of money, the following items are needed:

True

True or false: A key factor in making financial decisions is time value of money.

True

True or false: Frank can invest some of the money he has been saving in the stock market now; however, that would probably require some trade-offs on his part.

consumer spending

Which economic factor measures demand for goods and services?

trade balance

Which economic factor measures the difference between a country's exports and imports?

increased control of financial affairs

One advantage of personal financial planning is

$242

Phillip has an investment of $200 that is expected to earn 10% annually. How much will the investment be worth at the end of the SECOND year if the investment earns simple interest compounded annually?

present value

The current value of an amount at some time in the future, based on a certain interest rate and a certain time period is called:

financial calculator mathematical formulas time value of money tables

What are some of the methods that can be used to compute time value of money?

not having as much money in savings because you purchased new appliances to save energy costs taking home less pay now because you have increased tax withholdings to receive a larger tax refund not getting a high yield because you have set aside funds in a low risk investment

Examples of opportunity costs include:

True

True or false: Three items needed to calculate future value include: principal, length of time, annual interest rate.

Time value of money

What measures the increase in an amount of money as a result of interest earned?

American consumers provide foreign companies with a market.

What type of global influence does American consumption have on foreign companies?