Economy and Business Terms - Charlie, your teacher of English
indicate the life expectancy of an individual. Such tables may be used as the bases for calculating
estimated insurance premiums or monthly retirement annuities. When utilized by expert witnesses,
actuarial tables are admissible in evidence to show life expectancy.
Advertising: It is any communication designed to raise awareness and produce a desired effect. An
advertisement may occur through any medium, be that print, broadcast, imagery, or even word of
mouth. Many advertisements are basic; for example, there may be a radio announcement to "buy a
detergent called X." Others are more complex, encouraging purchase by stating that a product has
a better price and/or better quality. Many advertisements are intended to entertain. They are an
integral part of marketing. Informally, an advertisement is called an advert or an ad.
Aggregate demand: It is the total amount of goods and services demanded in the economy at a
given overall price level and in a given time period. It is represented by the aggregate-demand
curve, which describes the relationship between price levels and the quantity of output that firms are
willing to provide. Normally there is a negative relationship between aggregate demand and the
price level. Also known as "total spending".
Amortization: It is the running down or payment of a loan by installments. An example is a
repayment mortgage on a house, which is amortized by making monthly payments that over a preagreed period of time cover the value of the loan plus interest. With loans that are not amortized,
the borrower pays only interest during the period of the loan and then repays the sum borrowed in
full.
Annual bonus: This is the sum paid to with-profits policyholders at the end of each year from
surpluses in the with-profits fund.
Unlike stock market investors who see the value of their savings rise and fall, annual bonuses, once
paid, cannot be removed.
However, due to the problems experienced with with-profits funds, many companies have cut or
scrapped their annual bonuses.
Annual percentage rate (APR): The APR is the rate of interest that you agree to pay on the money
that you borrow. It was designed to allow consumers to compare products on a like-for-like basis
and every lender must quote this rate by law.
Basically, the higher the figure, the more you will pay. Confusingly, though, there are currently
several ways used to calculate APRs, making comparison very difficult.
Annuity: An annuity is a type of insurance policy that provides a regular income in exchange for a
lump sum paid into it on retirement.
Insurance companies convert the capital built up in your pension fund into a regular income. The
insurance company estimates how long you will live and uses this as a basis for the amount they
will pay you as an income. The longer you are likely to live, the lower your income is likely to be.

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