Human Wealth Is

question 15

Multiple Choice

Human wealth is

• A)the present discounted value of expected future after-tax labor income.
• B)the sum of financial and housing wealth.
• C)the discounted present value of all financial assets.
• D)financial wealth minus housing wealth.
• E) total wealth minus housing wealth.

---

Definitions:

Effective Interest Method

A technique used in accounting to allocate the interest expense or income over the life of a financial instrument such as a bond or a loan.

Bond Premium

The amount by which the market price of a bond exceeds its face value, often because it offers an interest rate higher than the current market rates.

Callable Bond

A type of bond that gives the issuer the right to repay the bond before its maturity date at a predetermined call price.

Term Bond

A bond that reaches its maturity date at the same time, where the principal amount is due in a lump sum at the end.