Which of the following statements describes factors that should be considered in the argument whether it is better to buy term life insurance or to buy permanent insurance and invest the premium difference?
(A) The cash value of a life insurance policy ca


The answer is (A). (B) is incorrect because people are more likely to pay a life insurance premium than they are to make a voluntary investment. (C) is incorrect because the life insurance industry has a solvency record unmatched by any other type of business organization. (D) is incorrect because increases in cash values are not subject to federal income taxes as they accrue, in contrast to the earnings in a separate investment program, which are often taxed as ordinary income.

Answered by Martha Gonzalez

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