LIBF Unit 2: Topic 7 Key terms

Question 1

In financial terms, an individual’s ability to react to unexpected events.

Accepted Answer

Flexibility

Question 2

To reduce in size or number for financial reasons, especially a home or a company’s personnel.

Accepted Answer

Downsize

Question 3

The extent to which an individual is seen as being likely to pay back any money they borrow.

Accepted Answer

Credit worthiness

Question 4

An independent organisation that maintains records of people’s credit history.

Accepted Answer

Credit reference agency

Question 5

The record that every financial transaction, and thus every person, leaves behind them.

Accepted Answer

Footprint

Question 6

A new UK welfare benefit intended to replace six separate benefits:

Accepted Answer

Universal credit

Question 7

When a person is liable for a company’s debts only up to the value of their investment.

Accepted Answer

Limited liability

Question 8

Losing a job because the business no longer needs, wants or can afford that job to be done.

Accepted Answer

Redundancy

Question 9

A charity providing free, independent, confidential and impartial advice.

Accepted Answer

Citizens Advice

Question 10

A loan, designed to be taken out for only a very short period, which charges a very high APR.

Accepted Answer

Payday loan

Question 11

A plan of expected incomings and outgoings over a set time period such as a month.

Accepted Answer

Budget

Question 12

Benefit payable to people who need financial support because of disability or health problem.

Accepted Answer

Personal Independence Payment (PIP)

Question 13

Borrowing based on the difference between the value of a house and the outstanding mortgage.

Accepted Answer

Equity Withdrawal

Question 14

A loan used to pay off a number of different debts.

Accepted Answer

Consolidation loan

Question 15

A company in which the owners’ financial liability is restricted to their investment.

Accepted Answer

Limited company

Questions 15