Chapter 7: Exam Questions
P is a forty year old woman and would like to purchase an annuity that will provide a lifetime income stream beginning at age sixty. Which of the following did she NOT buy?
An immediate annuity
A 45 year-old woman won $100,000 in a scratch off lottery ticket. She purchased an annuity that will pay her $1500 per month beginning at age 60. Which of these annuities this woman purchase?
Deferred fixed annuity
What type of annuity has a cash value that is based upon the performance of it's underlying investment funds?
variable
N, age 50, recently bought an annuity that will pay a guaranteed $2,000/month at age 70 for life. What type of annuity did N purchase?
Fixed Deferred
The type of annuity that can be purchased with one monetary deposit is called a(n)
Immediate annuity
An immediate annuity consists of a
Single Premium
S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation?
Single Premium
K has inherited a large sum of money. K purchases an annuity with this sum on July 1, and starts receiving payments August 1. These payments will continue for as long as she and her spouse lives. Which type of annuity did K purchase?
Single premium immediate joint with survivor annuity
A variable annuity has, which of the following characteristics?
Underlying equity investments
Which type of contract liquidates an estate through recurrent payments?
annuity
