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ABA CTFA Practice Test - Questions Answers, Page 37

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It's a managed care plan that is similar to a plan that is similar to a PPO but reimburses members only when affiliated providers are used. What is it?

A.
Individual practice association
A.
Individual practice association
Answers
B.
Preferred provider organization
B.
Preferred provider organization
Answers
C.
Exclusive provider organization
C.
Exclusive provider organization
Answers
D.
Point-of-service plan
D.
Point-of-service plan
Answers
Suggested answer: C

____________ is a hybrid form of HMO that allows members to go outside the HMO network for care and reimburses them at a specified percentage of the cost.

A.
Individual practice association
A.
Individual practice association
Answers
B.
Preferred provider organization
B.
Preferred provider organization
Answers
C.
Exclusive provider organization
C.
Exclusive provider organization
Answers
D.
Point-of-service plan
D.
Point-of-service plan
Answers
Suggested answer: D

If you have caused an accident, which type of automobile insurance would cover damage to your own car?

A.
Term
A.
Term
Answers
B.
Collision
B.
Collision
Answers
C.
Comprehensive
C.
Comprehensive
Answers
D.
Liability
D.
Liability
Answers
Suggested answer: B

Many savings programs are protected by the federal government against loss. Which of the following is Not?

A.
A bond issued by one of the 50 states
A.
A bond issued by one of the 50 states
Answers
B.
A U.S. Treasury bond
B.
A U.S. Treasury bond
Answers
C.
A U.S. savings bond
C.
A U.S. savings bond
Answers
D.
A certificate of deposit at the bank
D.
A certificate of deposit at the bank
Answers
Suggested answer: A

Which of the following instruments is NOT typically associated with spending?

A.
Cash
A.
Cash
Answers
B.
Credit card
B.
Credit card
Answers
C.
Debit card
C.
Debit card
Answers
D.
Certificate of deposit
D.
Certificate of deposit
Answers
Suggested answer: D

Doug must borrow $12,000 to complete his college education. Which of the following would NOT be likely to reduce the finance charge rate?

A.
If his parents took out an additional mortgage on their house for the loan
A.
If his parents took out an additional mortgage on their house for the loan
Answers
B.
If the loan was insured by the federal government
B.
If the loan was insured by the federal government
Answers
C.
If he went to a state college rather than a private college
C.
If he went to a state college rather than a private college
Answers
D.
If his parents co-signed the loan
D.
If his parents co-signed the loan
Answers
Suggested answer: C

If you had a savings account at a bank, which of the following would be correct concerning the interest that you would earn on this account?

A.
Sales tax may be charged on the interest that you earn
A.
Sales tax may be charged on the interest that you earn
Answers
B.
You cannot earn interest until you pass your 18th birthday
B.
You cannot earn interest until you pass your 18th birthday
Answers
C.
Earnings from savings account interest may not be taxed
C.
Earnings from savings account interest may not be taxed
Answers
D.
Income tax may be charged on the interest if your income is high enough
D.
Income tax may be charged on the interest if your income is high enough
Answers
Suggested answer: D

Under which of the following circumstances would it be financially beneficial to you to borrow money to buy something now and repay it with future income?

A.
When some clothes you like go on sale
A.
When some clothes you like go on sale
Answers
B.
When the interest on the loan is greater than the interest you get on your savings
B.
When the interest on the loan is greater than the interest you get on your savings
Answers
C.
When you need to buy a car to get a much better paying job
C.
When you need to buy a car to get a much better paying job
Answers
D.
When you really need a weeklong vacation
D.
When you really need a weeklong vacation
Answers
Suggested answer: C

Retirement income paid by a company is called:

A.
Rents and Profits
A.
Rents and Profits
Answers
B.
Social security
B.
Social security
Answers
C.
401(k)
C.
401(k)
Answers
D.
Pension
D.
Pension
Answers
Suggested answer: D

Many people put aside money to take care of unexpected expenses. If John and Jenny have money put aside for emergencies, in which of the following forms would it be of LEAST benefit to them if they needed it right away?

A.
Stocks
A.
Stocks
Answers
B.
Saving account
B.
Saving account
Answers
C.
Invested in a down payment in the house
C.
Invested in a down payment in the house
Answers
D.
Checking account
D.
Checking account
Answers
Suggested answer: C
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