Insurance and Investment Quiz

The out-of-pocket cost to the insured when a loss occurs is called

• Premium

• Deductible

• Claim

• Policy

Which of the following is a risk-free investment?

• Stocks

• Money Market accounts

• Corporate bonds

• Real Estate

Which of the following is a justifiable reason for not refunding a tenant's security deposit?

• Normal wear and tear of premises

• Holes in the walls

• Excessive noise

• None of these

The higher the rating on an investment grade bond;

• The higher the interest rate you will earn

• The lower the interest rate you will earn

• The more speculative it is

• None of these

Which of the following is true of an FHA mortgage loan?

• It allows for a smaller down payment.

• It requires you to pay a monthly mortgage insurance premium.

• It is backed by the Federal Housing Administration (FHA).

• All of these are true.

An investment portfolio should:

• Have a strong foundation of safe investments

• Concentrate on a single investment

• Exclude any high-risk investments

• None of these

When a company's overseas factory is destroyed during protests and rioting, this is an example of:

• Inflation risk

• Industry risk

• Political risk

• Company risk

The legal process that allows a lender to take possession of a house because the borrower does not meet his or her mortgage obligations is called:

• Garnishment

• Foreclosure

• Bankruptcy

• Discharge

Long-term goals may involve:

• Planning a vacation

• Saving for college

• Retirement planning

• All of the above

When a rental agreement contains a purchase option at the end of the rental term, the renter is said to have:

• Refusal of first right

• A balloon option

• The right of first refusal

• A deferred-payment plan