You Want to Earn a Real Rate of Return of 3.25

question 39

Multiple Choice

You want to earn a real rate of return of 3.25 percent at a time when the inflation rate is 2.41 percent. What is the approximate nominal rate which you must earn?

• A) 5.42 percent
• B) 5.66 percent
• C) 5.68 percent
• D) 5.74 percent
• E) 5.81 percent

Grasp the concept of life insurance as a financial valuation of life for protection against financial loss.

Identify the different types of life insurance policies and their features.

Understand the criteria to evaluate the need for life insurance.

Acknowledge the role of life insurance in financial planning and protection for dependents.

---

Definitions:

Capital Lease

A lease agreement in which the lessee gains ownership or a substantial portion of the rights to the asset by the end of the lease term, treated as a purchase in accounting.

Lessee

A person or entity that leases property or equipment from another, known as the lessor, under a lease agreement.

Lessor

An entity or individual that owns an asset and grants another party the right to use that asset in exchange for periodic rental payments.

Capital Lease

A lease classified by the lessee as an asset and liability on the balance sheet because it effectively transfers substantially all risks and rewards of ownership to the lessee.