Fin 008 - Personal Finance and Investments » Winter 2021 » Quiz 4

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Question #1
The 401k plans give employees a pre-tax or tax-deferred way to save for retirement.
A.     
B.   TRUE
C.   FALSE
Question #2
Disability insurance insures your income against an accident or illness that impairs your earning ability.
A.   FALSE
B.   TRUE
Question #3
An advantage of mutual funds that they have built in diversification.
A.   FALSE
B.   TRUE
Question #4
A starting point for your estimates of retirement expenses is
A.   the way you want to live when you retire.
B.   the rate at which your savings compound.
C.   the effects of inflation on your costs.
D.   how long you will need to support yourself in retirement.
E.   your current level of spending.
Question #5
Issuers of stock
A.   expect investors to share in profits and losses.
B.   pay dividends whether or not there is a profit.
C.   promise returns.
D.   also issue bonds.
E.   must trade in a public stock exchange.
Question #6
When you invest in stocks you
A.   pay dividends and sell equity for liquidity
B.   pay dividends.
C.   buy a share of a corporation.
D.   pay dividends, buy a share of a corporation and sell equity for liquidity
E.   sell equity for liquidity.
Question #7
Your risk tolerance represents
A.   the amount of time separating you from your money.
B.   your ability or willingness to take chances.
C.   your wealth or net worth.
D.   your return objective.
E.   the amount of money you stand to lose.
Question #8
Uninsurable risks that offer a chance of loss or gain are called
A.   risk avoidance.
B.   trade-offs.
C.   speculative risks.
D.   risk shifts.
E.   pure risks.
Question #9
Hazards covered by the homeowner's policy include all the following EXCEPT
A.   damage caused by aircraft or vehicles.
B.   floods and earthquakes.
C.   riots.
D.   smoke damage.
E.   explosions.

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