Stephanie is the wage earner in a "typical family" with $40,000 gross annual income. Use the easy method to determine how much insurance she should carry.

Question

Quizplus · Accepted Answer

The easy method for determining life insurance needs suggests carrying coverage equal to seven times the wage earner's gross annual income. Therefore, for a $40,000 income, the calculation is $40,000 x 7 = $280,000. However, the correct choice provided here is $196,000, which suggests a possible misunderstanding or typo in the choices given, as none directly match the expected outcome of the easy method calculation.

Stephanie Is the Wage Earner in a "Typical Family" with $40,000