Ch. 3 Personal Finance formulas

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learn these formulas using key phrases/words

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10 Terms

1
New cards

What formula calculates interest accrued on a deferred loan (e.g., student loans)?

  • "Interest accrued"

  • "Loan deferment"

  • "Grace period"

<ul><li><p><strong>"Interest accrued"</strong></p></li><li><p><strong>"Loan deferment"</strong></p></li><li><p><strong>"Grace period"</strong></p></li></ul><p></p>
2
New cards

What formula is used to calculate APR for short-term loans (e.g., payday loans)?

  • "Payday loan"

  • "Short-term loan"

  • "Loan term in days"

  • "Convert to annual rate"

<ul><li><p><strong>"Payday loan"</strong></p></li><li><p><strong>"Short-term loan"</strong></p></li><li><p><strong>"Loan term in days"</strong></p></li><li><p><strong>"Convert to annual rate"</strong></p></li></ul><p></p>
3
New cards

What formula calculates credit card interest using the Average Daily Balance Method?

  • "Credit card finance charge"

  • "Balance carried over"

  • "Monthly rate"

<ul><li><p><strong>"Credit card finance charge"</strong></p></li><li><p><strong>"Balance carried over"</strong></p></li><li><p><strong>"Monthly rate"</strong></p></li></ul><p></p>
4
New cards

What formula finds the total cost of an installment loan?

  • "Installment plan"

  • "Total cost of financing"

  • "Monthly payments over time"

<ul><li><p><strong>"Installment plan"</strong></p></li><li><p><strong>"Total cost of financing"</strong></p></li><li><p><strong>"Monthly payments over time"</strong></p></li></ul><p></p>
5
New cards

What formula calculates monthly payments for a loan (amortization formula)?

  • "Fixed monthly payment for a loan"

  • "Mortgage payment calculation"

  • "Car loan monthly payment"

<ul><li><p><strong>"Fixed monthly payment for a loan"</strong></p></li><li><p><strong>"Mortgage payment calculation"</strong></p></li><li><p><strong>"Car loan monthly payment"</strong></p></li></ul><p></p>
6
New cards

How do you convert APR to a monthly rate?

  • "Convert APR to monthly rate"

  • "Find the interest rate per month"

<ul><li><p><strong>"Convert APR to monthly rate"</strong></p></li><li><p><strong>"Find the interest rate per month"</strong></p></li></ul><p></p>
7
New cards

What formula calculates APR for a long-term loan?

  • "Annualized rate of a long-term loan"

  • "Total interest paid over years"

<ul><li><p><strong>"Annualized rate of a long-term loan"</strong></p></li><li><p><strong>"Total interest paid over years"</strong></p></li></ul><p></p>
8
New cards

What formulas calculate the total amount paid and finance charge on a loan?

  • "Find the total amount spent on a loan"

  • "How much extra was paid in interest?"

<ul><li><p><strong>"Find the total amount spent on a loan"</strong></p></li><li><p><strong>"How much extra was paid in interest?"</strong></p></li></ul><p></p>
9
New cards

What formula updates a credit card balance after payments, purchases, and finance charges?

  • "New credit card statement balance"

  • "Update after payments and purchases"

<ul><li><p><strong>"New credit card statement balance"</strong></p></li><li><p><strong>"Update after payments and purchases"</strong></p></li></ul><p></p>
10
New cards

How do you calculate available credit on a credit card?

  • "How much credit can still be used?"

  • "Find available balance on a card"

<ul><li><p><strong>"How much credit can still be used?"</strong></p></li><li><p><strong>"Find available balance on a card"</strong></p></li></ul><p></p>