Practice the vocabulary used in banking and financial services with this exercise. Understanding these terms will help you read financial news and communicate confidently in finance-related discussions.
💵 Did you know? Finance edition "In the red" and "in the black" come from the traditional practice of writing losses in red ink and profits in black ink in account books. "We finished the quarter in the black" means profitable; "in the red" means operating at a loss. Both expressions are widely used in everyday business English. The word "leverage" in finance means using borrowed money to increase potential returns. Outside finance, it's used as a verb in business meetings everywhere: "We can leverage our existing relationships to enter the new market." It's one of the most overused words in corporate English. "Hedge" in finance means reducing risk by taking an offsetting position. In everyday English it survives in "hedging your bets" — covering multiple options to avoid total loss. The connection to financial hedging is direct.
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Choose the correct response to complete each sentence.
1. Your _________________ rate determines the repayments you make on the money you borrow from a bank.
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2. The money you borrow from a bank is called a _________________.
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3. I have to _________________ another loan.
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4. If you'd like to buy a house, you will probably have to take out a _________________.
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5. A _________________ mortgage ensures that your interest rate will not change.
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6. Your home may be _________________ if you don't keep up repayments on your mortgage.
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7. Usually banks have two types of personal accounts - checking and _________________.
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8. You can _________________ paying account fees if you keep a minimum daily balance of $1000 on your account.
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9. P1: What's the _________________ on my account? P2: It's $450. ( = there's $450 in your account)
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