Which of the Following Term Plans Is Intended to Cover

question 5

Multiple Choice

Which of the following term plans is intended to cover an individual's outstanding debt?

• A)Renewable term
• B)Reentry term
• C)Credit life
• D)Mortgage life
• E)Both C and D above

---

Definitions:

Risk-Free Rate

The return on investment with no risk of financial loss, traditionally associated with government bonds.

Expected Rate

The anticipated rate of return on an investment, often based on historical data or statistical analysis.

Market Risk Premium

The additional return investors expect for holding a risky market portfolio instead of risk-free assets.

Risk-Free Rate

The hypothetical return on a risk-free investment, typically illustrated by the interest earned on government securities.