Money Matters - 2nd Semester Final

Which of the following best describes the benefits of having insurance?

• The policyholder may become better off financially if an accident occurs
• Insurance combined with emergency savings provides a sense of financial security and peace of mind
• The policyholder no longer has to worry about paying for financial losses resulting from an accident because all risk of financial loss is transferred to the insurance company
• It is required by law to purchase insurance so the benefits do not matter

Maggie will need to pay $120 per month in order to purchase a health insurance policy. This monthly payment is known as the:

• deductible
• co-insurance
• premium
• moral hazard

Insurance can be purchased to protect one from which of the following losses?

• Stock market losses
• Health care expenses
• Maintaining the price of your home
• Car maintenance

Tiffany was recently involved in a vehicle accident. In order to get her car fixed, her insurance company is requiring her to pay the first $500 of the repair bill because:

• she did not call her agent and report the accident quickly enough
• her policy's deductible is $500
• she will be reimbursed by the insurance company later
• the cost of the repairs is higher than her policy covers

Eric has chosen Amanda to be the beneficiary of his life insurance policy. What does this mean for Amanda?

• Amanda must pay the insurance premiums to keep the policy in effect
• Amanda will receive any proceeds if Eric dies
• Amanda will receive a commission for selling Eric his life insurance policy
• Amanda is required to serve as the executor of Eric's estate

It is recommended that life insurance be purchased when the:

• individual reaches the age of 50
• individual flies in an airplane
• individual gets their first job
• individual has dependents

What is the difference between property and liability insurance?

• Property insurance pays for loss to the insured person whereas liability insurance pays for loss to other people
• Property insurance pays for loss to other people whereas liability insurance pays for loss to the insured person
• The difference between property and liability insurance depends on the specific insurance policy purchased
• The difference between property and liability insurance depends on whether automobile, homeowners, or renters insurance is purchased.

Patty recently moved into a new apartment with her friend Emma. Who is responsible for purchasing renters insurance?

• The property manager
• Patty and Emma's parents
• Patty and Emma
• Renters insurance is not necessary

A rental agreement is often referred to as:

• a lease
• an amenity
• renters insurance
• a mortgage

Rent is defined as:

• the cost of using someone else's property
• the fee charged for performing property management tasks
• an advance payment for costs beyond normal wear and tear
• the purchase price of a housing unit