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

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