WISE Financial Literacy Test terms

WISE Financial Literacy Test terms Sources of income - answerwages, rentals, interest, capital, profits, investments, entrepreneurship exemption - answeralso called allowance: used to reduce amount of taxed income liquidity - answerthe degree of ease in which assets can be sold gift cards - answerclosed loop system and open loop system; can be purchased in fixed amounts and redeemed for purchases from particular businesses discretionary income - answeralso called budget surplus; not allocated for food or shelter money order - answera payment order for a pre-specified amount of money and is purchased at a different types of stores- it is used like a check. They are usually limited in maximum face value to some specified figure. (For example, the United States Postal Service limits domestic postal money orders to US $1,000.00); US Postal money orders are hard to counterfeit. why does US currency have value - answerthere is a belief that money has value and therefore is accepted. opportunity cost - answernext best alternative; it is what is given up when a choice is made. inflation - answerhurt: lenders (banks) and people living on fixed income. Least hurt: those who owe large amounts of money; a general increase in prices and fall in the purchasing value of money. treasury department - answercollects taxes, prints money, issues treasury bonds. pay yourself first - answerstrategy for saving for the future by putting money aside before paying regular monthly bills certificate of deposit - answerit is a time deposit offered at financial institutions-penalty if cashed before maturity. institutions that give loans - answerbanks, credit unions, financial companies, payday lenders, tax preparers institutions that charge high intrest - answerpawnshops, payday lenders, tax refund lenders, tax refund lenders, finance companies.