Finance > QUESTIONS & ANSWERS > LIBF- Unit 3, Top Exam Question and answers, 100% Accurate, rated A+ (All)
LIBF- Unit 3, Top Exam Question and answers, 100% Accurate, rated A+ Bank rate - ✔✔The interest rate that the Bank of England uses when it lends money to other banks. Financial services provi... ders take account of the Bank rate when they decide how to set interest rates on their own products. Cash flow forecast - ✔✔A plan of expected incomings and outgoings over several time periods, such as the next three months or a year. Cash flow modelling - ✔✔A software program that can predict the medium- and long-term impact of different decisions and events on an individual's income, expenditure and savings plans. Credit union - ✔✔A mutual organisation (that is, owned by its members) that provides a range of financial products to members, eg savings accounts and personal loans. Flexible financial planning - ✔✔Making financial plans to cover wants, needs and aspirations over the medium to long term, which make allowance for unexpected expenses and changes in circumstance (eg by including saving and insurance). Income protection insurance - ✔✔A policy that allows people to manage the risk of loss of earnings over a long term. It pays out a monthly income to insured people who have suffered an accidental injury or long-term illness and who are therefore unable to work. Individual savings account - ✔✔An account that pays interest tax-free on savings up to a certain level. In 2014 the rules were changed, with a higher limit on the amount that can be saved tax-free. Savers can choose to save the entire amount in cash, or in stocks and shares, or in a mixture of the two. Insolvency - ✔✔A situation in which a person cannot repay what they owe because their debts are greater than their assets. Money purchase Pension scheme - ✔✔A pension scheme in which the value of the fund available at retirement is based on the contributions made by an employee (and their employer, in workplace schemes), which are invested. Also known as defined-contribution schemes. Mortgage payment protection insurance - ✔✔An insurance policy intended to cover mortgage payments in the event of illness or unemployment. Personal debt - ✔✔The debt owed by individual consumers (as opposed to the debts of companies or governments). Recession - ✔✔A period of at least six months in which the amount of goods and services the country is producing is shrinking. Savings bond - ✔✔A savings product held for a fixed period, eg two years. The holder can only make a limited number of withdrawals, or none at all, during that period without incurring a penalty. Shares - ✔✔Also known as 'equities', investments that represent part-ownership in a company. Sustainable personal finance - ✔✔Achieving and maintaining a balance between personal income and expenditure to satisfy needs, wants and aspirations within a budget. Attendance allowance - ✔✔Payable to those aged 65+ who have a long-term illness or disability that means they cannot perform basic daily living activities or have limited mobility. Carer's allowance - ✔✔Paid to anyone over 16 who spends 35 hours per week or more looking after someone who has substantial care needs. Child tax credit - ✔✔A benefit paid to people who are in low-paid work, to help with the costs of bringing up a child. Consumer prices index - ✔✔One of the means the government uses to measure inflation. It is calculated by checking the price of a representative sample of goods on a monthly basis - this enables statisticians to measure how much prices are rising or falling. Contributory benefits - ✔✔Benefits paid to eligible claimants providing they have paid the required number of National Insurance contributions (NICs). Employment and support allowance - ✔✔Provides an income directly from the state when sickness or disability prevents you from working. Gross domestic product - ✔✔The value of all the goods and services produced within a country over a year. Housing benefit - ✔✔Paid to those who have low incomes - either because they are in low- paid work or they are not employed - to help with their housing costs. Income support - ✔✔A payment designed to provide a 'safety net' for those not eligible for other unemployment and sickness allowances, to provide money to pay for basic needs. Means testing - ✔✔Means-tested benefits are reduced if your household income is above a certain level or you have more than £6,000 in savings. Non contributory benefits - ✔✔Benefits paid to eligible claimants who have either not paid enough NICs to claim contributory benefits or need a 'top-up' payment because the contributory benefits they receive do not meet their income needs. Personal independence payment - ✔✔Payable to those aged 16-64 who have a long-term illness or disability that means they are unable to perform basic daily living activities or have limited mobility State pension - ✔✔A benefit that people receive from the state once they reach a certain age, providing they have paid or been credited with enough National Insurance contributions. Universal credit - ✔✔A means-tested benefit for people of working-age that will eventually replace six other benefits. Welfare state - ✔✔The state provision of health care and education, low-cost social housing and a comprehensive system of contributory and non-contributory pensions and social security benefits. Working tax credit - ✔✔A payment made to people who have a job but earn less than the minimum level considered to be enough to live on. Automation - ✔✔Where a computer tak [Show More]
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LIBF revision. All units , Exam Questions and answers, 100% Accurate, rated A+. Easy revision and mastery.
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