McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Uncategorized topics .
| 151. |
Identify a Non-Physical Asset, from the List of Following Options. |
| A. | Car |
| B. | House |
| C. | Goodwill |
| D. | Air-Conditioner |
| Answer» C. Goodwill | |
| 152. |
Mr. Manish asks His Insurance-Advisor, the Primary Purpose of Insurance. Help Mr. Manish, Identify the Primary Purpose of Insurance, from the Following Options. |
| A. | Share the Losses of Many, among Many. |
| B. | Share the Losses of Many, among a Few. |
| C. | Share the Losses of a Few, among Many. |
| D. | Speculation. |
| Answer» C. Share the Losses of a Few, among Many. | |
| 153. |
What led to the Formulation of Insurance? |
| A. | Hazard |
| B. | Indemnity |
| C. | Loss |
| D. | Risk |
| Answer» D. Risk | |
| 154. |
Which One of the Following Methods of Risk- Management, is also known as Self-Insurance? |
| A. | Risk-Avoidance |
| B. | Risk-Retention |
| C. | Risk-Reduction and Risk- Control |
| D. | Risk-Transfer |
| Answer» B. Risk-Retention | |
| 155. |
When would You choose, to go for Insurance? |
| A. | After the Contingent Event has occurred. |
| B. | When the Probability of Event-Occurrence is Low, But, Severity is High. |
| C. | When the Probability of Event-Occurrence is Low, along with the Severity. |
| D. | When you can finance the Losses of the Contingent-Event, on Your Own. |
| Answer» B. When the Probability of Event-Occurrence is Low, But, Severity is High. | |
| 156. |
Which One of the Following, is, the First Indian Insurance Company? |
| A. | The Oriental Life Assurance Company Limited |
| B. | Triton Insurance Company Limited |
| C. | Bombay Mutual Assurance Society Limited |
| D. | National Insurance Company Limited |
| Answer» C. Bombay Mutual Assurance Society Limited | |
| 157. |
Name the Public Sector Life Assurance Company, formed as a Result of Nationalisation of Life Assurance in India. |
| A. | General Insurance Corporation (G.I.C.) of India |
| B. | Life Insurance Corporation (L.I.C.) of India |
| C. | Oriental Insurance Company of India |
| D. | National Insurance Company Limited |
| Answer» B. Life Insurance Corporation (L.I.C.) of India | |
| 158. |
Discuss the Risk-Management Technique, employed by an Individual, when He or She purchases the Insurance. |
| A. | Risk-Avoidance |
| B. | Risk-Retention |
| C. | Risk-Transfer |
| D. | Risk-Mitigation |
| Answer» C. Risk-Transfer | |
| 159. |
Discuss the Difference between Insurance and Assurance. |
| A. | Insurance: Protection Against an Event, that Will Happen. Assurance: Protection Against an Event, that Might Happen. |
| B. | Insurance: Protection Against an Event, that Might Happen. Assurance: Protection Against an Event, that Will Happen. |
| C. | Both: Insurance and Assurance, Refer to the Same Thing. |
| D. | Insurance: Guaranteed Protection, Against an Event, that Might Happen. Assurance: Protection Against an Event, that Might Happen, is Not Guaranteed. |
| Answer» B. Insurance: Protection Against an Event, that Might Happen. Assurance: Protection Against an Event, that Will Happen. | |
| 160. |
Mr. Poddar has used Insulated Wiring in His House, so as to Reduce the Chances of Damage, Due to Fire. Identify the Risk-Management Technique, practiced here. |
| A. | Risk-Avoidance |
| B. | Risk-Retention |
| C. | Risk-Transfer |
| D. | Risk-Reduction and Risk- Control |
| Answer» D. Risk-Reduction and Risk- Control | |
| 161. |
Ms. Shaheen refuses to go on a Business-Trip to Iraq, because of Violence in the Destination Country. Identify the Risk-Management Technique, practiced here. |
| A. | Risk-Avoidance |
| B. | Risk-Retention |
| C. | Risk-Transfer |
| D. | Risk-Reduction and Risk- Control |
| Answer» A. Risk-Avoidance | |
| 162. |
Mr. Suresh has purchased a Life Assurance Policy, so that, His Family-Members do not have to depend on Any-One, in Case of His Un-Timely Death. Identify the Risk-Management Technique, practiced here. |
| A. | Risk-Avoidance |
| B. | Risk-Retention |
| C. | Risk-Transfer |
| D. | Risk-Reduction and Risk- Control |
| Answer» C. Risk-Transfer | |
| 163. |
Ms. Smita has set-up a Reserve Fund, to be used for the Repairs, in Case, the House is damaged for Some Reason. Identify the Risk-Management Technique, practiced here. |
| A. | Risk-Financing |
| B. | Risk-Retention |
| C. | Risk-Transfer |
| D. | Risk-Reduction and Risk- Control |
| Answer» A. Risk-Financing | |
| 164. |
Which One of the Following Statements, is Correct? |
| A. | Insurance protects the Asset from Damage. |
| B. | Insurance prevents the Losses. |
| C. | Insurance reduces the Possibility of Loss. |
| D. | Insurance indemnifies the Insured, in the Event of a Loss. |
| Answer» D. Insurance indemnifies the Insured, in the Event of a Loss. | |
| 165. |
You are an Insurance-Surveyor. On Behalf of the Insurer, Why Will You survey and inspect a Property, Prior to Insurance? |
| A. | To Assess the Risk, for Rating Purposes. |
| B. | To Arrive At the Valuation of the Property, by Looking at the Surroundings. |
| C. | To Find-Out: How Far the Property is, From the City. |
| D. | To Get a Look at the Neighbouring Properties, Also. |
| Answer» A. To Assess the Risk, for Rating Purposes. | |
| 166. |
Who, originally proposed the Concept of Human Life Value (H.L.V.)? |
| A. | William Faulkner |
| B. | Mr. N. Malhotra |
| C. | Economist, Adam Smith |
| D. | Professor Hubener |
| Answer» D. Professor Hubener | |
| 167. |
Describe an Asset, in General. Choose the Most Appropriate Option. |
| A. | An Asset is Some-Thing, that is Freely Available. |
| B. | An Asset is Some-Thing, that yields a Value or a Return. |
| C. | An Asset is Some-Thing, that yields No Return, and Only provides an Utility. |
| D. | An Asset is Some-Thing, that cannot be owned. |
| Answer» B. An Asset is Some-Thing, that yields a Value or a Return. | |
| 168. |
The Principle of Indemnity is Applicable to --. |
| A. | Life Assurance |
| B. | General Insurance |
| C. | Life Assurance and General Insurance |
| D. | Neither Life Assurance, Nor General Insurance. |
| Answer» B. General Insurance | |
| 169. |
Which One of the Following, cannot be categorised under the Risks, faced by Ordinary People? |
| A. | Living, Too Long. |
| B. | Dying, Too Early. |
| C. | Natural Wear and Tear. |
| D. | Living with Disability. |
| Answer» C. Natural Wear and Tear. | |
| 170. |
Identify the Two Factors, that need to be considered, while calculating Human Life Value (H.L.V.). |
| A. | Net-Earnings of the Bread-Winner and Number of Family- Members. |
| B. | Net-Earnings of the Bread-Winner and Annual Rate-of-Interest. |
| C. | Net Earnings of the Bread-Winner and His or Her Job-Type. |
| D. | Net Earnings of the Bread-Winner and Insurance-Purchased |
| Answer» B. Net-Earnings of the Bread-Winner and Annual Rate-of-Interest. | |
| 171. |
Which One of the Following Methods, is, a Traditional Method, that can Help Determine the Insurance, needed by an Individual? |
| A. | Human Property-Value |
| B. | Life-Term Proposition |
| C. | Human Life-Value |
| D. | Future Life-Value |
| Answer» C. Human Life-Value | |
| 172. |
Identify the Component, that is Not a Part of the Life Assurance Business. |
| A. | Asset |
| B. | Risk |
| C. | Principle of Mutuality |
| D. | Speculation |
| Answer» D. Speculation | |
| 173. |
Which One of the Following, cannot be an Asset? |
| A. | Air |
| B. | Car |
| C. | House |
| D. | Goodwill |
| Answer» A. Air | |
| 174. |
What was the Primary Argument, behind "Buy Term Assurance and Invest the Difference, Else-Where"? Choose the Most Appropriate Option. |
| A. | Term Assurance is the Best Form of Life Assurance. |
| B. | Investing the Balance Premiums, in Other Investment-Instruments, could yield a Higher Return. |
| C. | The Policy-Holder can take the Higher Risks, by investing the Balance Premium in the Equities. |
| D. | Non-Term Assurance has the Lowest Yields. |
| Answer» B. Investing the Balance Premiums, in Other Investment-Instruments, could yield a Higher Return. | |
| 175. |
All of the Following, are the Advantages of Cash-Value Insurance-Contracts, Except --. |
| A. | Inculcates the Saving- Discipline |
| B. | Safe and Secure Investment |
| C. | Income-Tax Benefits |
| D. | Lower Yields |
| Answer» D. Lower Yields | |
| 176. |
All of the Following, are the Dis-Advantages of Cash- Value Insurance-Contracts, Except --. |
| A. | Lower Yields |
| B. | Safe and Secure Investment |
| C. | Returns, Subject to Corroding Effect of Inflation |
| D. | Low Accumulation in Early Years |
| Answer» B. Safe and Secure Investment | |
| 177. |
Which One of the Following Statements, is In-Correct? |
| A. | Under Mutuality, the Funds of Various Individuals, are combined. |
| B. | Mutuality is also known as Pooling. |
| C. | Under Mutuality, We have the Funds flowing from One Source to Many. |
| D. | Mutuality provides Protection against the Economic Loss, arising as a Result of One’s Un- Timely Death. This Loss is shouldered and addressed through having a Fund, that pools the Contributions of Many, Who have entered into the Life Assurance Contracts. |
| Answer» C. Under Mutuality, We have the Funds flowing from One Source to Many. | |
| 178. |
Mr. Rajan earns Rupees 1,20,000/-, a Year, and spends Rupees 24,000/-, on Him-Self. Suppose the Rate of Interest is 8% (expressed as 0.08). Calculate the Human Life Value (H.L.V.), in this Case. |
| A. | Rupees 12 Lakhs. |
| B. | Rupees 13 Lakhs. |
| C. | Rupees 14 Lakhs. |
| D. | Rupees 15 Lakhs. |
| Answer» A. Rupees 12 Lakhs. | |
| 179. |
Mr. Ramesh is 55 Years' Old, and has 5 Working-Years, Left for Retirement. Currently, His Annual Income is Rupees 5 Lakhs, and He has purchased a Life Assurance Policy of Rupees 15 Lakhs. If He were to die Pre-Maturely, in the Current-Year, it-self, then, How Much Will His Family get from the Life Assurance Company? |
| A. | Rupees 20 Lakhs. |
| B. | Rupees 15 Lakhs. |
| C. | Rupees 10 Lakhs. |
| D. | Rupees 5 Lakhs. |
| Answer» B. Rupees 15 Lakhs. | |
| 180. |
Ms. Prajakta earns Rupees 2,40,000/-, Per Annum. She spends Rupees 1 Lakh, Per Annum, on Her-Self. The Market Rate-of-Interest is 7%. Calculate Ms. Prajakta's Life Assurance Amount, through the Human Life Value (H.L.V.) Method. |
| A. | Rupees 15 Lakhs. |
| B. | Rupees 20 Lakhs. |
| C. | Rupees 10 Lakhs. |
| D. | Rupees 24 Lakhs. |
| Answer» B. Rupees 20 Lakhs. | |
| 181. |
Compare the Probability of a Contingent-Event, with Regard to Life Assurance and General Insurance. |
| A. | The Probability of the Event-Happening, stays Constant, through Time, with Regard to Both: Life Assurance and General Insurance. |
| B. | The Probability of the Event-Happening, increases in Case of General Insurance, and decreases in Case of Life Assurance. |
| C. | The Probability of the Event-Happening, increases in Case of Life Assurance, and decreases in Case of General Insurance. |
| D. | The Probability of the Event-Happening, increases in Case of Life Assurance, and stays Constant in Case of General Insurance. |
| Answer» D. The Probability of the Event-Happening, increases in Case of Life Assurance, and stays Constant in Case of General Insurance. | |
| 182. |
Analyse the Following Two Statements, and Determine the True One(s): Statement-I: The Contingent-Event occurs Certainly, in Case of General Insurance. Statement-II: The Contingent-Event occurs Certainly, in Case of Life Assurance. |
| A. | Statement-I is True. |
| B. | Statement-II is True. |
| C. | Statement-I and Statement-II are True. |
| D. | Statement-I and Statement-II are False. |
| Answer» B. Statement-II is True. | |
| 183. |
Suggest a Class of Insurance, that will provide the Protection against Loss of Goodwill. |
| A. | Life Assurance |
| B. | Property Insurance |
| C. | Liability Insurance |
| D. | Personal Insurance |
| Answer» C. Liability Insurance | |
| 184. |
Explain to us, Why, Young People are charged Less Life Assurance Premium, when compared to the Old People. |
| A. | Young People do not need Life Assurance, as much as the Old People. |
| B. | Young People cannot afford to buy Costly Life Assurance Products, Due to their Low Income. |
| C. | Mortality is Directly Proportional to Age. |
| D. | Mortality is Inversely Proportional to Age. |
| Answer» C. Mortality is Directly Proportional to Age. | |
| 185. |
--- Planning involves: How Much You should Save for Your After-Working-Life, and Where should You Invest those Funds. |
| A. | Estate |
| B. | Tax |
| C. | Education |
| D. | Retirement |
| Answer» D. Retirement | |
| 186. |
Name the Term, used to denote the Rise in the General Level of Prices of Goods and Services, in an Economy, Over a Period of Time. Choose the Most Appropriate Option. |
| A. | Hyper-Inflation |
| B. | Inflation |
| C. | Deflation |
| D. | Stagflation |
| Answer» B. Inflation | |
| 187. |
What is the Term, used to refer to the Value of What You Own, Minus, the Value of What You Owe? |
| A. | Net-Worth |
| B. | Income-Statement |
| C. | Financial Plan |
| D. | Net Budget |
| Answer» A. Net-Worth | |
| 188. |
Assess the Impact of Inflation on Your Investment- Returns. |
| A. | Inflation has No Impact on the Investment- Returns. |
| B. | Inflation has a Positive Impact on the Investment-Returns. |
| C. | Inflation has a Corroding Impact on the Investment-Returns. |
| D. | Inflation boosts the Investment-Returns. |
| Answer» C. Inflation has a Corroding Impact on the Investment-Returns. | |
| 189. |
Examine the Following Options, and Identify the One, which is Not a Credit-Management Decision. Choose the Most Appropriate Option. |
| A. | Investing Money in a Bank-Deposit. |
| B. | Financing Your House with Mortgage. |
| C. | Paying the Utility-Bills, through Credit-Card. |
| D. | Securing a Home-Loan, to Buy a House. |
| Answer» A. Investing Money in a Bank-Deposit. | |
| 190. |
Identify the Stage of Life, when an Individual will appreciate His or Her Long-Term Savings, the Most. |
| A. | Childhood |
| B. | Just Married |
| C. | Teen Age |
| D. | Post-Retirement |
| Answer» D. Post-Retirement | |
| 191. |
Suggest a Good Time to Start the Financial Planning. |
| A. | Post-Retirement |
| B. | After Marriage |
| C. | On Receipt of First Salary |
| D. | During Childhood |
| Answer» C. On Receipt of First Salary | |
| 192. |
Creating a Current Cash-Flow Statement and Balance- Sheet, help, with Which Step of the Financial Planning Process? |
| A. | Development of Financial Goals. |
| B. | Determining the Current Financial Position. |
| C. | Evaluating the Alternatives. |
| D. | Implementing a Financial Plan. |
| Answer» B. Determining the Current Financial Position. | |
| 193. |
Performing an Analysis of Current Income-Flow and Expenditure-Flow, is termed as --. |
| A. | Net-Worth Analysis |
| B. | Budgeting |
| C. | Personal Financial Planning |
| D. | Sensitivity-Analysis |
| Answer» B. Budgeting | |
| 194. |
Which One of the Following, is, the Least Likely Way, that, You may benefit from Having an Understanding of Personal Finance? |
| A. | Becoming Director of a Large Bank. |
| B. | Making Your Own Financial Decisions. |
| C. | Becoming a Financial Planner. |
| D. | Assessing the Advice of Another Financial Planner. |
| Answer» A. Becoming Director of a Large Bank. | |
| 195. |
What is the Purpose, behind buying Insurance? |
| A. | Wealth-Creation. |
| B. | Management of Expenses. |
| C. | Protection Against Un- Certainty. |
| D. | Receive Income-Tax Sops. |
| Answer» C. Protection Against Un- Certainty. | |
| 196. |
What happens in the Distribution-Phase of Retirement- Planning? |
| A. | Small Savings are made on a Regular Basis, to accumulate a Corpus. |
| B. | Corpus is Consolidated. |
| C. | Corpus is converted into Withdrawal or Annuities, for meeting the Income-Needs, Post- Retirement. |
| D. | High-Risk Investments are made. |
| Answer» C. Corpus is converted into Withdrawal or Annuities, for meeting the Income-Needs, Post- Retirement. | |
| 197. |
Describe the Purpose of Tax-Planning. Choose the Most Appropriate Option. |
| A. | Tax-Evasion |
| B. | Planning Your Investments, in a Manner, such that, Maximum Benefits are Applicable. |
| C. | Provide for Taxes. |
| D. | Pay Tax, On Time. |
| Answer» B. Planning Your Investments, in a Manner, such that, Maximum Benefits are Applicable. | |
| 198. |
Explain: 'Risk-Tolerance'. Choose the Most Appropriate Option. |
| A. | Types of Risks, One Can Take. |
| B. | Amount of Risk, One is Willing to Bear, while Investing. |
| C. | Instruments of Risk- Management. |
| D. | Period, for which, One is willing to risk His or Her Investments. |
| Answer» B. Amount of Risk, One is Willing to Bear, while Investing. | |
| 199. |
Illustrate the Computation, a Person would use, to Determine the Current Value of a Desired Amount, for the Future. |
| A. | Simple Interest |
| B. | Present Value of a Single Amount |
| C. | Future Value of a Single Amount |
| D. | Future Value of a Series of Deposits |
| Answer» B. Present Value of a Single Amount | |
| 200. |
What is involved in Future-Value Calculations? Choose the Most Appropriate Option. |
| A. | Discounting |
| B. | Compounding |
| C. | Internal Rate-of-Return |
| D. | Simple Interest |
| Answer» B. Compounding | |
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