Lesson 2: Introduction to Finance

Interest earned on both the principal amount and any interest already earned.

An agency of the United States that insures deposits in banks/ thrifts for up to $250,000

A depository institution where one can keep and borrow money and take care of finances.

The value of a future cash stream discounted at the appropriate market interest rate.

Degree of uncertainty of return on an asset; the possibility of loss.

The ability of individuals to make appropriate decisions in managing their personal finances.

The amount of interest based on a principal amount and not on earned interest.

Money’s potential to grow in value over time.

Financial institutions that help consumers, businesses, and governments manage money.

The science of the management of money and other assets.

A professional who provides financial planning and advice on financial matters.

An independent federal agency that serves to supervise and regulate federal credit unions.

A fee paid for the use of money over time.

What an amount invested today at a particular interest rate will be worth in the future.

A financial institution that protects persons against the risk of financial loss.

A nonprofit financial institution that is privately owned and controlled by its members.

The central bank of the United States.