Explain How Dividends May Be Used When Distributed to the Policy

question 23

Essay

Explain how dividends may be used when distributed to the policy owner in a participating contract.

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Definitions:

Productivity

A measure of the efficiency of production, often calculated as the ratio of outputs produced to inputs used in the production process.

Trade

The act of buying, selling, or exchanging commodities within domestic or international markets.

Mutually Beneficial

A scenario where all parties involved gain advantages or benefits from an arrangement or transaction.

Flexible Budget

A budget that adjusts or scales according to variations in actual activity levels or output, providing a more realistic comparison of costs and revenues.