Fin lit words

words + definitions for unit fin lit exam

Financial Literacy

Financial Literacy

the possession of a body of financial knowledge, a set of basic skills and the ability to apply knowledge and skills to making, responsible financial choices

Personal financial planning

the process of setting financial goals and developing plans to reach them while meeting financial needs.

Financial plan

an overview of an individual’s current financial position and strategies to meet future financial aspirations.

Needs

necessities a person must have to survive

wants

things that a person desires but can live without

consumer

an individual who purchases goods and services for their own use

goods

tangible items that can be touched, used, and purchased (food, clothing)

services

intangible activities that another person usually performs for a fee

values

principles and beliefs that a person considers important

Value system

the overall structure of values and goals that guides a person’s behavior and provides a sense of direction in life

ethics

the moral principles of beliefs that directs a person’s behavior

priority

a value or a goal that is giver more importance than other values and goals

standard

an established measure of quality, value, or quantity

resource

a supply of something that can be used when needed

goal

is an objective to be attained in a specific amount of time

financial competence

having the ability to understand basic topics related to finance such as wisely making, spending, and saving money

cost-benefit analysis

a method of weighing the cost against the benefits of an action, a purchase, or a financial decision

marginal benefit

the change in total benefit of using one additional unit

marginal cost

the change in total cost of using one more unit

law of diminishing marginal utility

states that the marginal benefit of using each additional unit of something tends to decrease as the quantity used increases

trade off

the choice you give up when you make one choice over another

opportunity cost

is the value of the option you gave up

systematic decision making

is the process of choosing a course of action after evaluating available information and weighting the cost and benefits of alternative actions and their consequences

economic conditions

are the state of economy at a given time

recession

a period of slow/no economic growth

inflation

is the period of rising prices

interest

is the amount that is paid for using money

demographics

the statistical characteristics of a population

culture

is the beliefs, behaviors and other characteristics common among members of a group or society

technology

is the application of science and research to human life and environment

Media

forms of communication designed to reach a large number of people

entitlement

is a government program that provides financial benefits to elible citizens based on their legal rights

globalization

the worldwide spread and integration of production, markets, communications, and technology.

management

the process of organizing and using resources to achieve predetermined objectives

personal information management

a system that individuals use to acquire, organize, maintain, retrieve, and use information

employability/soft skills

the skills used to communicate and work well with others.

Human resources

internal, including energy, knowledge, experience, skills, talents, motivation, imagination, and determination, parents, friends, teachers too.

nonhuman resources

external - money, time, and equipment, value of camera, computer, car

resources are scarce

resources are manageble

resources are related to one another

multiple resources can be combined to reach a specific goal

3 diff types of goals

to be, to do, to have

questions to ask when setting goals

is the goal realistic and possible? can i break big goals into smaller pieces? can i measure my progress? what will the goal cost in time, money, and effort? will i still want the goal by the time i am able to reach it?

goals are often interdependent

meaning you will have to reach one goal in order to achieve another

steps of decision making process

1. Define the decision

2. explore all the alternatives

3. Choose the best alternative

4. act on the decision

5. evaluate the solution or decision

success depends on two things

determination + flexibility

offshore sourcing

the business practice of moving factories and jobs overseas and across borders to take advantage of cheap labor and business-friendly government regulations.

social media

websites and apps that allow individual users to network online by creating and sharing content with one another