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.   TRUE
B.   FALSE
C.     
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.   TRUE
B.   FALSE
Question #4
A starting point for your estimates of retirement expenses is
A.   your current level of spending.
B.   the effects of inflation on your costs.
C.   the rate at which your savings compound.
D.   how long you will need to support yourself in retirement.
E.   the way you want to live when you retire.
Question #5
Issuers of stock
A.   pay dividends whether or not there is a profit.
B.   expect investors to share in profits and losses.
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, buy a share of a corporation and sell equity for liquidity
B.   pay dividends and sell equity for liquidity
C.   sell equity for liquidity.
D.   buy a share of a corporation.
E.   pay dividends.
Question #7
Your risk tolerance represents
A.   the amount of money you stand to lose.
B.   the amount of time separating you from your money.
C.   your ability or willingness to take chances.
D.   your return objective.
E.   your wealth or net worth.
Question #8
Uninsurable risks that offer a chance of loss or gain are called
A.   pure risks.
B.   trade-offs.
C.   risk shifts.
D.   speculative risks.
E.   risk avoidance.
Question #9
Hazards covered by the homeowner's policy include all the following EXCEPT
A.   floods and earthquakes.
B.   damage caused by aircraft or vehicles.
C.   smoke damage.
D.   explosions.
E.   riots.

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