Under Which of the Following Does the Insurer Promise to Pay

question 19

Multiple Choice

Under which of the following does the insurer promise to pay the insured a fixed yearly amount,as guaranteed income,after the insured attains a specified age?

• A) Straight life policy.
• B) Whole life policy.
• C) Universal life policy.
• D) Annuity contract.

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Definitions:

Market-capitalization Rate

A valuation ratio determined by dividing the market capitalization of a company by its after-tax earnings, reflecting how much investors are willing to pay for a share of the company's earnings.

Plowback Ratio

The proportion of earnings retained by a company for reinvestment in its operations rather than being paid out as dividends to shareholders.

Expected ROE

The projected Return on Equity, estimating the amount of net income returned as a percentage of shareholders' equity.

Required Rate Of Return

The lowest yearly return rate on an investment that motivates individuals or corporations to invest in a specific security or project.