Preparing Income Tax Returns (Chapter 5)

*Marginal tax rate- the rate of tax paid on the last dollar of taxable income.

Variations and formulas (Chapter 6)

*Relationships- in mathematics a relationship is a connection between two variables; changing the value of one of the variables changes the value of the other.
*Variable- letter or symbol used o represent quantity that can change.
*Variation- A relationship between two variables which can be expressed as a formula, a table of values, or as a graph.
*Direct variation- the relationship between two variables x and y with the form y=kx where k is constant. A direct variation may be represented by a straight line graph which passes through the origin (0,0)
*Constant of variation- the value of k in the direct variation formula y=kx. K is equal to the slope of the line when thre variation is graphed.
*y varies directly as x- gives the formla y=kx for variation constant, k.
*Directly proportional- means the same as varies directly.
*Fixed cost- a cost that remains.
*Partial variation- the relationship between two variables x and y with the form y=kx + F where k is the constant of variation and F is a fixed number. A partial variation may be represented by a sraight line graph with slope k and which passes through the point (0,F)
*Variable cost- a cost that changes depending upon the amount of goods purchased.
*Vertical intercept- the value where a graph touches or crosses the vertical axis.
*Direct squared variation- a relationship between two variables which can be written in the form y=kx (exponant 2) where k is a constant. The shape of a graph showing this variation will be curved. Te curve will begin at the origin.
*Varies directly as the square- y varies directly as the square of x gives the formula y=kx(exponant 2) with constant of variation, k.
*Inverse variation- a relationship between two variables which can be written in the form y=k/x where k is a contsant. A graph showing this variation decreases as you move to the right along the horizontal axis.

Design and Measurement (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 diminishing 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.

Investments (Chapter 4)

*Capital gain- money earnd in an equity investment.

*Capital loss- money lost in an equitity investment.

*Debt Investment- an investment that involves lending money to a company.

*Eqjuity investment- an investment that involves lending money to a company.

*Canad Deposit Insurance Corporation (CDID)- 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.

*Portfolio- a selection of investments.

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

*Formula for future value- FV= [PMT (1+i)n- 1/ i ]

Government Finances (Chapter 3)

*Expenditures: Money that government pays out for programs and services it it provides.

*Revenue: Money that the governmenr 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.

Personal Finance 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.


• Premium- how much you pay for an insurance policy (monthly, semi-annually, or annually).


• Amortization period- the length of time in years that you will need to pay off a mortgage.


• Equity- The portion of the valuebof your property that you own.


• Interest- The cost of borrowing money.


• Principal- the amount you initially borrowed.


• Unpaid balance- the portion of the value of your property owed to the financial instiution.


• Closed mortage- a mortgage which does not allow payments on the principal.


• Fixed-rate mortgage- a mortgage with the interest rate locked in for 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 reflected in the appraisal


• Replacement value- with reference to insurance policies, it means stolen or damaged items are 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 referance to homeowner's insurance, this means a location within city limits.


• Protected- with referance to homeowner's insurance, this means a location within 300 metres of a fire hydrant.


• Semi-protected- with referance to homeowner's insurance, this means a location within 8km of a firehall.


• Unprotected- with referance to homeowner's insurance, this means a location more than 8km from a fiehall.