Kim was injured in a freak accident in her dorm room and had to spend several days in
the hospital. Her covered medical costs totaled $14,000. How much will Kim’s health
insurance policy pay for this claim given the following policy information?
$250 deductible per year
80/20 coinsurance
$1,500 per year out-of-pocket coinsurance cap
a.$12,250
b.$11,200
c.$11,000
d.$10,950
The required rate of return on a bond is
A.the interest rate that equates the current market price of the bond with the present
value of all future cash flows received.
B.equivalent to the current yield for non-par bonds.
C.less than the E(r) for discount bonds and greater than the E(r) for premium bonds.
D.inversely related to a bond’s risk and coupon.
E.none of the options.
Refer to Figure 12-1. Using the needs-based approach, how much additional life
insurance is needed on Trina’s life? a. $373,845
b. $468,750
c. $525,750
d. $575,750
Depository institutions include
A.banks.
B.thrifts.
C.finance companies.
D.all of the options presented.
E.banks and thrifts.
For the purposes for which they are used, money market securities should have which
of the following characteristics?
I. Low trading costs
II. Little price risk
III. High rate of return
IV. Life greater than one year
A.I and III
B.II and IV
C.III and IV
D.I and II
E.I, II, and III
Your first line of defense against unauthorized use of your banking accounts is prompt
examination of your periodic statement provided by your banking institution.
a.True
b.False
______ provide(s) preventative care as well as other types of care for a set monthly fee
which is considered to be advance payment for the care received.
a.Traditional health insurance
b.Consumer-driven health insurance
c.Health maintenance organization (HMO)
d.Preferred provider organization (PPO)
Refer to Figure 14-1. The book value of Rosa’s is currently
Figure 14-1
Rosa’s is a small chain of Mexican food restaurants that features five delicious varieties
of salsa. The business has grown over the past ten years from a hobby to a small
corporation with 200,000 shares of common stock outstanding. The corporation has not
issued any preferred stock. The following is Rosa’s latest financial data:
NARREND
a.$20,500,000.
b.$15,800,000.
c.$7,700,000.
d.$4,700,000.
Which of the following information is NOT usually found in a Wall Street Journal stock
quote?
A.dividend yield
B.price-earnings ratio
C.closing price of the stock
D.stock rating
E.ticker symbol
The largest market available for purchased funds is the ___________________.
A.wholesale CD market
B.Eurodollar deposit market
C.banker’s acceptances market
D.discount window purchases
E.Fed funds market
You can help yourself afford a longer benefit period under a long-term care insurance
plan by selecting a longer
a.waiting period.
b.cost-of-living period.
c.recurring period.
d.Social Security period.
A ____ is a typical feature of seller financing when you buy a home.
a.balloon payment
b.$0 downpayment
c.rapid build-up in equity
d.long payoff period
For an open-ended credit account a credit limits is set by the lender and represents the
maximum outstanding debt allowed on the account.
a.True
b.False
A corporation seeking to sell new equity securities to the public for the first time in
order to raise cash for capital investment would most likely
A.conduct an IPO with the assistance of an investment banker.
B.engage in a secondary market sale of equity.
C.conduct a private placement to a large number of potential buyers.
D.place an ad in the Wall Street Journal soliciting retail suppliers of funds.
E.none of the options.
An investor has unrealized gains in 100 shares of Amazin stock for which he does not
wish to pay taxes. However, he is now bearish upon the stock for the short term. The
stock is at $76 and he buys a put with a strike of $75 for $300. At expiration the stock is
at $68. What is the net gain or loss on the entire stock/option portfolio?
A.$700
B.-$800
C.-$400
D.-$200
E.-$100