FINANCIAL LITERACY PREPARATORY TEST

Bank account for business transactions?

• Fixed deposit account

• Recurring deposit account

• Current account

• Savings account

First fire insurance company was due to:

• Indian Independence

• Global Financial Crisis

• Earthquake in Japan

• Great Fire of London

Money in a piggy bank is:

• Earning interest

• Not earning interest

• Both B and C

• Available for immediate withdrawal

FV = PV(1+iN) calculates:

• Present Value

• Risk Factor

• Rate of Interest

• Future Value

Main purpose of social insurance?

• Cover property damage

• None of the above

• Protect against unemployment and disability

• Provide life coverage

Which carries the highest risk?

• Fixed deposits

• Stocks

• Savings account

• Bonds

Main purpose of savings?

• Immediate consumption

• Payment of loans

• Future use and emergencies

• Investment in stocks

What is collateral in loans?

• An asset pledged to secure the loan

• The amount borrowed

• The monthly repayment amount

• The interest rate

Implication of education loan?

• Affects credit score

• Provides tax benefits

• All of the above

• Must be repaid with interest

Type of life insurance?

• All of the above

• Endowment plan

• Term insurance

• Whole life insurance