WhyExplain Glossary
Plain-English definitions of 32 terms used across our explainers on money, business, marketing and tech. Each one links to the full article.
Money
- Amortization
Paying off a loan in equal installments, where each payment covers that month's interest and the rest reduces what you owe. Early payments are mostly interest.
Read: Loan repayment calculator →- APR (annual percentage rate)
The yearly cost of borrowing, including interest and some fees, before compounding is taken into account.
Read: Compound interest →- APY (annual percentage yield)
What you actually earn in a year once compounding is included. It is higher than the stated rate whenever interest compounds more than once a year.
Read: Compound interest →- Compound interest
Interest earned on your original money and on the interest it has already earned, so growth speeds up over time.
Read: What is compound interest? →- Consumer Price Index (CPI)
A US government measure of how the prices city households pay for a set basket of goods and services change over time.
Read: What is inflation? →- Diversification
Spreading money across many investments so that a loss on one has a smaller effect on the whole.
Read: What is an index fund? →- Effective tax rate
The share of your total income that goes in tax, once every bracket is added up. It is always lower than your top bracket rate.
Read: How tax brackets work →- Expense ratio
The yearly fee a fund charges, shown as a percentage of the money you have invested in it.
Read: What is an index fund? →- Federal funds rate
The interest rate the US Federal Reserve targets for overnight lending between banks. It influences most other borrowing and savings rates.
Read: Why are interest rates rising? →- Index fund
A fund that buys every company in a market index, such as the S&P 500, instead of picking individual winners.
Read: What is an index fund? →- Inflation
The general rise in prices over time, which means each dollar buys a little less than before.
Read: What is inflation? →- Marginal tax rate
The rate charged on your next dollar of income. Each bracket's rate applies only to the income inside that bracket.
Read: How tax brackets work →- Principal
The amount you borrow or invest, before any interest is added.
Read: Compound interest →
Business
- Business model
How a company creates something people value, delivers it, and turns that into profit.
Read: What is a business model? →- Cash flow
The money moving into and out of a business over a period. A profitable company can still run out of cash.
Read: What is cash flow? →- Competitive advantage
Something that lets a business keep earning more than its rivals for a long time, such as a strong brand or lower costs. Often called a moat.
Read: What is a competitive advantage? →- Free cash flow
The cash a business has left after paying its running costs and the investment it needs to keep going.
Read: What is cash flow? →- Gross margin
Revenue minus the direct cost of making what was sold, shown as a percentage of revenue.
Read: What is profit margin? →- Net margin
The share of revenue left as profit after every cost, including interest and tax.
Read: What is profit margin? →- Tariff
A tax on imported goods, paid to the government by the business that brings the goods into the country.
Read: What are tariffs? →
Marketing
- AI Overviews
AI-written summaries that Google shows at the top of some search results, with links to the pages they draw on.
Read: What are Google AI Overviews? →- Backlink
A link from another website to yours. Search engines treat good backlinks as a sign that a page is trusted.
Read: What is a backlink? →- CAN-SPAM Act
The US law that sets rules for commercial email, including an honest subject line and a working way to unsubscribe.
Read: What is email marketing? →- Email marketing
Sending messages to people who have agreed to hear from you, to inform them, build trust and sell.
Read: What is email marketing? →- Search engine optimization (SEO)
Improving a website so search engines can find, understand and show its pages to the people looking for them.
Read: What is SEO? →- Search intent
The goal behind a search: to learn something, find a site, compare options or buy.
Read: What is search intent? →
Tech & AI
- Agentic AI
AI systems that can plan steps and use tools to complete a task, not just answer a single question.
Read: What is agentic AI? →- AI hallucination
When an AI system states something false or made up as if it were true.
Read: What are AI hallucinations? →- Artificial intelligence (AI)
Computer systems that do tasks which normally need human judgment, such as understanding language or spotting patterns.
Read: What is AI? →- Large language model (LLM)
An AI model trained on huge amounts of text to predict the next word, which lets it write, summarize and answer questions.
Read: What is a large language model? →- Machine learning
A way of building software that learns patterns from examples instead of following rules written by hand.
Read: What is machine learning? →- Token
A small piece of text, often part of a word, that a language model reads and writes one at a time.
Read: What is a large language model? →
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