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Chapter Review

Key Terms

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  • Interest added to the principal of an account, so that the added interest also earns interest going forward.

  • The lending of money, goods, or services with the expectation of future payment.

  • A small plastic card issued by a bank or business allowing the holder to purchase goods or services on credit. A form of revolving credit.

  • A number assigned to a person that indicates to lenders their capacity to repay a loan.

  • A sum of money placed or kept in a bank account, usually to gain interest.

  • An initial payment made when something is bought on credit.

  • A line of credit made available to cover overdrafting a checking account.

  • The amount charged on top of the principal by a lender to a borrower for the use of assets.

  • The lowest amount of money that you are required to pay on a debt each month.

  • The amount a borrower is required to pay each month until a debt is paid off.

  • The amount borrowed or still owed on loan.

  • A sum of money charged by school, college or university for lodging and food.

  • A payment made to support a student’s education, awarded on the basis of academic or other achievement.

  • Refers to the length of time that you have to repay, or to specific features in your loan (like rates, required payments, and more).

  • A sum of money charged for teaching or instruction by a school, college, or university.