Consumer Studies Notes Review

Flashcards covering key concepts from the Consumer Studies lecture notes.

Simple Interest

Calculated only on the principal amount borrowed or invested.

Compound Interest

Calculated on the principal amount and also on the interest already accumulated.

Inflation

The continuous increase in the prices of goods and services, leading to a decrease in the purchasing power of money.

Fixed Interest Rate

An interest rate that remains the same for the full period of the loan and does not fluctuate.

Variable Interest Rate

An interest rate that fluctuates as the bank's interest rate changes.

Inflation Rate

The percentage at which the prices of goods and services increase in a year.

Consumer Price Index (CPI)

A measure used to calculate the inflation rate by tracking the price changes of a basket of goods and services.

Monetary Policy Committee

A committee that makes decisions regarding monetary policy, including interest rates.

Repo Rate

The rate at which the central bank lends money to commercial banks.

Purchasing Power

The ability to buy goods and services with a given amount of money.