As the beneficiary of a segregated fund, how much will Marge receive after Homer’s death?

In the context of segregated funds, the amount that a beneficiary receives upon the death of the policyholder can depend on several factors, including the death benefit guarantees and the performance of the underlying investments. If Homer designated Marge as the beneficiary of a segregated fund with a guaranteed death benefit, she generally receives the greater of the fund's market value at the time of death or the guaranteed amount.

If the correct choice indicates that Marge would receive $125,000, it suggests that this amount is either the guaranteed death benefit or reflects the principal plus any additional return guaranteed by the contract, surpassing the market value of the fund at the time of death. This is significant in understanding the nature of segregated funds, which often include guarantees that aim to safeguard the policyholder’s investment against market downturns and provide stability in the benefit paid out.

Additionally, the guaranteed return represents the insurance aspect of segregated funds, which are typically sold with the assurance that the beneficiary will receive either the market value or a specified amount, thus making option C a logical conclusion based on how structured guarantees work in such financial instruments. Marge's receipt of $125,000 reflects the security intended in these products, providing clarity on the safety of investments held within