All of the Following Statements About Shopping for Auto Insurance

question 31

Multiple Choice

All of the following statements about shopping for auto insurance are true EXCEPT

• A)Adequate liability insurance is the most important consideration.
• B)Consideration should be given to dropping physical damage insurance on an older car with a low market value.
• C)To obtain the lowest premium,an applicant should review his or her eligibility for all discounts offered.
• D)Price comparisons are of little value since auto insurers tend to charge the same premiums.

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Definitions:

Equity Method

An accounting technique used to record the investments in other companies where the investor has significant influence but does not fully control the investee.

Excess Amortizations

Excess Amortizations refer to the amount by which amortization expenses exceed what is deemed necessary or standard for a given period, often adjusting the value of intangible assets.

Intra-Entity Transactions

Transactions occurring between divisions or departments within the same company.

Intra-Entity Gross Profit

The profit realized from transactions within segments of the same company, not reflected in consolidated financial statements until realized externally.