Which of the following statements about the Linton yield is (are)true?
I.It is based on the assumption that a cash-value policy can be viewed as a combination of insurance protection and a savings fund.
II.It is the average compound annual rate of return required to make the savings deposits in a life insurance policy equal to the policy's guaranteed cash value at the end of a specified period.

Question

Quizplus · Accepted Answer

Both statements are true. The Linton yield is based on the assumption that a cash-value policy can be viewed as a combination of insurance protection and a savings fund, and it is the average compound annual rate of return required to make the savings deposits in a life insurance policy equal to the policy's guaranteed cash value at the end of a specified period.

Which of the Following Statements About the Linton Yield Is