26. What is the primary objective of an insurance policy?
a. Generating profits for the insurance company
b. Providing financial protection against potential risks and losses
c. Investing in stocks and bonds for capital appreciation
d. Regulating the activities of insurance agents
27. What is the purpose of a futures contract in financial markets?
a. Transferring the ownership of stocks and bonds
b. Providing insurance coverage for commodity prices
c. Speculating on the future price movements of assets
d. Regulating the activities of investment banks
28. Which financial institution is responsible for supervising and regulating the insurance industry in the United States?
a. Federal Reserve System (Fed)
b. Securities and Exchange Commission (SEC)
c. National Credit Union Administration (NCUA)
d. National Association of Insurance Commissioners (NAIC)
29. What is the purpose of a credit default swap (CDS)?
a. Transferring the risk of default on a loan or bond from one party to another
b. Providing insurance coverage for credit card transactions
c. Speculating on the future price movements of stocks and bonds
d. Regulating interest rates in the banking sector
30. Which of the following is a characteristic of a defined contribution retirement plan?
a. Guaranteed income payments for retirees
b. Employer-sponsored pension plan
c. Fixed contribution amount from employees and employers
d. Government-funded retirement program
