Financial Literacy

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Question

What is compound interest?

Answer

Interest calculated on the initial principal and accumulated interest

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Question

What is the compound interest formula?

Answer

$A = P\left(1 + \frac{r}{n}\right)^{nt}$

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Question

What is APR?

Answer

Annual Percentage Rate - the yearly interest rate including fees

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Question

What is the difference between a credit and debit card?

Answer

Credit borrows money, debit uses your own money from your account

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Question

What is a mortgage?

Answer

A loan used to purchase real estate, secured by the property itself

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Question

What is simple interest?

Answer

Interest calculated only on the principal amount

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Question

What is the simple interest formula?

Answer

$I = P \times r \times t$

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Question

What is a budget?

Answer

A plan for spending and saving money over a specific period

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Question

What is an emergency fund?

Answer

Money set aside for unexpected expenses

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Question

What is inflation?

Answer

The rate at which prices for goods and services increase over time

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