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Question 1 of 10
1. Question
Which of the following funds are private investment funds that are legally restricted to very wealthy individuals who have an income surpassing the requisite threshold and at least a $1 million net worth?
Correct
Hedge funds are private investment funds that are legally restricted to very wealthy individuals, individuals who have an income surpassing the requisite threshold and at least a $1 million net worth. Hedge funds are, in essence, mutual funds for the super wealthy.
Incorrect
Hedge funds are private investment funds that are legally restricted to very wealthy individuals, individuals who have an income surpassing the requisite threshold and at least a $1 million net worth. Hedge funds are, in essence, mutual funds for the super wealthy.
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Question 2 of 10
2. Question
When Private investments might involve funding a private company to develop new technologies or simply to be more successful in general then which of the following involve purchasing a public company for the sake of making it private:
Correct
Private equity consists of any equity which isn’t quoted on any public exchanges. Private investments might involve funding a private company to develop new technologies, or simply to be more successful in general. Private equity also might involve purchasing a public company for the sake of making it private.
Incorrect
Private equity consists of any equity which isn’t quoted on any public exchanges. Private investments might involve funding a private company to develop new technologies, or simply to be more successful in general. Private equity also might involve purchasing a public company for the sake of making it private.
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Question 3 of 10
3. Question
Which of the following securities are linked to some other underlying asset, such as another security, a group of securities, a commodity, and index, or something else:
Correct
Structured products are securities which are linked to some other underlying asset, such as another security, a group of securities, a commodity, and index, or something else. Structured products can sometimes have a “principal guarantee” feature, which means simply that the principal is guaranteed to return if the investor holds the investment for long enough
Incorrect
Structured products are securities which are linked to some other underlying asset, such as another security, a group of securities, a commodity, and index, or something else. Structured products can sometimes have a “principal guarantee” feature, which means simply that the principal is guaranteed to return if the investor holds the investment for long enough
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Question 4 of 10
4. Question
Which of the following annuities are not considered securities, because all the risk is on the insurance company, not the buyer?
Correct
Fixed annuities are not considered securities, because all the risk is on the insurance company, not the buyer.
Incorrect
Fixed annuities are not considered securities, because all the risk is on the insurance company, not the buyer.
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Question 5 of 10
5. Question
Which of the following statements is (are) true for the variable annuity?
I. Purchaser is taking the risk
II. It guarantees payments for life
III. It is considered security
IV. All the risk is on the insurance company, not the buyerCorrect
Variable annuities are considered securities, because the purchaser is taking the risk. With variable annuities, investors’ monies are deposited into an account separate from the insurance company’s general account, and the company invests these funds. Variable annuities guarantee payments for life, but don’t guarantee the amount of the payments or the rate of return on the investment.
Incorrect
Variable annuities are considered securities, because the purchaser is taking the risk. With variable annuities, investors’ monies are deposited into an account separate from the insurance company’s general account, and the company invests these funds. Variable annuities guarantee payments for life, but don’t guarantee the amount of the payments or the rate of return on the investment.
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Question 6 of 10
6. Question
Which of the following charge is meant to cover the cost for keeping the account on the books, and therefore is usually waived for individuals who notify the insurance company of the cancellation sufficiently in advance?
Correct
The surrender charge is meant to cover the cost for keeping the account on the books, and therefore is usually waived for individuals who notify the insurance company of the cancellation sufficiently in advance.
Incorrect
The surrender charge is meant to cover the cost for keeping the account on the books, and therefore is usually waived for individuals who notify the insurance company of the cancellation sufficiently in advance.
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Question 7 of 10
7. Question
The time during which the purchaser of an annuity is paying into the annuity, up until the time the purchaser begins receiving income payments, is known as:
Correct
The time during which the purchaser of an annuity is paying into the annuity, up until the time the purchaser begins receiving income payments, is called the accumulation phase.
Incorrect
The time during which the purchaser of an annuity is paying into the annuity, up until the time the purchaser begins receiving income payments, is called the accumulation phase.
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Question 8 of 10
8. Question
Which of the following statement reflects when the insurance company pays the annuitant until he dies; after the annuitant dies, no payments are given to beneficiaries:
Correct
With life income, the insurance company pays the annuitant until he dies; after the annuitant dies, no payments are given to beneficiaries.
Incorrect
With life income, the insurance company pays the annuitant until he dies; after the annuitant dies, no payments are given to beneficiaries.
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Question 9 of 10
9. Question
When two parties, usually husband and wife are entitled to one payment, and when the first party dies, the other party receives the payments until his or her death is related to which of the following:
Correct
The last option is joint life with last survivor. With this arrangement, two parties, usually husband and wife, are entitled to one payment, and when the first party dies, the other party receives the payments until his or her death.
Incorrect
The last option is joint life with last survivor. With this arrangement, two parties, usually husband and wife, are entitled to one payment, and when the first party dies, the other party receives the payments until his or her death.
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Question 10 of 10
10. Question
Money from large numbers of investors is pooled and invested for their mutual benefit in the insurance company’s separate account is related to:
Correct
Money from large numbers of investors is pooled and invested for their mutual benefit in the insurance company’s separate account, just as in a mutual fund. Many of these separate accounts are registered as open-end management investment companies.
Incorrect
Money from large numbers of investors is pooled and invested for their mutual benefit in the insurance company’s separate account, just as in a mutual fund. Many of these separate accounts are registered as open-end management investment companies.