Vocabulary- Chapter 5

Marginal Tax Rate: The rate of tax paid on the last dollar of taxable income

Vocabulary- Chapter 4

Capital gain: Money earned in an equity investment

Capital loss: Money lost in an equity investment

Debt investment: An investment that involves lending money to a company

Equity investnent: An investment that involves part ownership in a company

Canada Deposit Insurance Corporation: A corporation that offers protection for certain investments in Canadian financial institutions

Face value: Value at the maturity date

Maturity date: The date on which you can redeem your GIC, bond, or T-bill without penalty

Term: Length of an investment

The Rule of 72: To quickly estimate the length of time it takes for an investment to double in value, divide 72 by the interest rate (as a number, not a percentage) to find the time in years. For example, if the interest is 10%, divide 72 by 10. It would take 7.2 years.

Vocabulary- Chapter 2

Vanishing point: The point at which parallel lines appear to converge

Perspective: Point of view

Perspective drawing: A realistic view of an object that shows dimishing dimensions due to distance

Exploded view: A view showing how the components of an object fit together

Oblique view: A slanted or inclined view of an object

Constituent parts: The parts of an object that fit together to complete the whole object

Vocabulary- Chapter 3

Expenditures- Money the government pays out for programs and services it provides

Revenue- Money the government collects from taxes and other sources

Deficit- The amount by which expenditures exceed revenue in a budget

Surplus- The amount by which revenue is greater than expenditures in a budget

Debt- An amount that is owed

Vocabulary- Chapter 1

Beneficiary: The person who will receive the insurance money.

Insurer: The company providing the insurance.

Policy: A written contract or certificate of insurance.

Preminum: How much you pay for an insurance policy.

Amortization Period: The length of time in years that you will need to pay off a mortage.

Equity: The portion of the value of your property that you own.

Interest: The cost of borrowing money.

Principal: The amount you initially borrow.

Unpaid Balance: The portion of the value of your property owed to the financial institution.

Closed Mortgage: A mortgage which does not allow payments on the principal.

Fixed-rate Mortgage: A mortgage with the interest rate locked in for a specified period of time.

Open Mortgage: A mortgage that allows additional payments on the principal.

Variable-rate Mortgage: A mortgage where the interest rate may change from month to month.

Gross Debt Service Ratio: A formula used by most financial institutions to determine whether or not you can afford the property you have selected.

Market Value: The age and deterioration of the items are reflectede in the appraisal.

Replacement Value: With reference to insurance policies, it means stolen or damaged items and replaced with new items.

Tenant's Package Policy: Insurance policy that protects renters from loss of contents of their rental units or personal belongings.

Metro: With referenceto homeowner's insurance, this means a location within city limits.

Protected: With reference to homeowner's insurance, this means a location with 300 metres of a fire hydrant.

Semi-protected: With reference to homeowner's insurance, this means a location with 8 km of a firehall.

Unprotected: With reference to homeowner's insurance, this means a location more that 8 km from a firehall.