[FIN 221] - Final Exam Guide - Ultimate 25 pages long Study Guide!
Document Summary
Chapter 1: personal finance basics and the time value of money. Possessions/independence/giving to what matters: personal financial planning is the process of managing your money to achieve personal economic satisfaction. This planning process allows you to control your financial situation. Spend only on things that are of value to you, not to compare yourself to others. Decide whether to buy something now or later. If you buy later, you may have to pay more: interest rate risk: changing interest rates, income risk, personal risk, liquidity risk, create and implement your financial adaption plan, review and revise your plan. Economic conditions: consumer prices: the buying power of a dollar. Consumer price index (cpi): average change in price for a (cid:862)(cid:271)asket(cid:863) of goods and servi(cid:272)es. Inflation: is a rise in the general level of prices. Deflation: is a fall in the general level of prices. Rule of 72: years for something to double. Exhibit 1-5: understand these terms and concepts.
