One Way That Life Insurance Firms Can Hedge the Risk

question 51

Multiple Choice

One way that life insurance firms can hedge the risk created by offering whole-life insurance policies is by ________.

• A) holding long-term bonds
• B) holding equities
• C) holding short-term bonds
• D) exercising its right to terminate the policy

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Definitions:

Helicotrema

Opening at the apex of the cochlea through which the scala vestibuli and the scala tympani of the cochlea connect.

Bony Labyrinth

A complex system of channels and cavities within the temporal bone of the skull, housing the organs of hearing and balance in the inner ear.

Attenuation Reflex

The reflex mechanism that protects the inner ear from damage by reducing the transmission of sound, particularly for loud sounds, through the contraction of muscles around the ossicles.

Scala Vestibuli

A fluid-filled chamber in the cochlea of the inner ear; it lies above the scala media and begins near the oval window.