James Is Concerned That If He Purchases a Fixed Immediate

question 11

Multiple Choice

James is concerned that if he purchases a fixed immediate annuity his funds will be tied-up and not accessible if an emergency arises.His insurance agent said that a rider could be attached to his annuity to address this concern.The rider is a(n)

• A)partial cash withdrawal rider.
• B)return of premium rider.
• C)guaranteed purchase option rider.
• D)waiver-of-premium rider.

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Definitions:

Machine-Hours

A measure of production output or activity, where one machine-hour equals one hour of operation of a machine.

Assembly Department

An area in a manufacturing plant where parts are put together to form the end products.

Overhead Rate

A calculated rate used to allocate overhead costs to products or services, usually determined by dividing total overhead costs by an allocation base.

Predetermined Overhead Rate

A rate used to apply manufacturing overhead to products or job orders, calculated based on the estimated costs and activity levels before the period begins.