Kaplan Q bank missed Qs

You recently took a trip to Warsaw, Poland, and when you received your credit card statement, you noticed that your vodka purchase for 100 Polish Zlotys resulted in a $30 charge on your statement. Based on this exchange rate, each dollar was worth approximately

3.33 Zlotys 100/30 = 3.33

Under the Uniform Securities Act, which of the following statements is true about the authority of an Administrator?

A cease and desist order may be issued prior to a hearing. A cease and desist order may be issued after a hearing.

Which of the following persons does not meet the definition of providing investment advice as a business outlined in SEC Release IA-1092?

A management consultant whose only investment advice is suggesting to a couple of small-business clients who had invested their surpluses in speculative securities that they should find something less risky

An investment adviser representative specializes in the senior market. A number of his clients have reached the age where they are contemplating selling their homes and moving into an assisted living facility. The profit made on the sale of their homes will be used to defray the costs of their new residence. Under current tax laws, which of the following are true?

A single person pays no tax on the first $250,000 of net profit realized on the sale of a primary residence that has been occupied for at least two of the past five years. & A married couple pays no tax on the first $500,000 of net profit realized on the sale of a primary residence that has been occupied for at least two of the past five years.

A 35-year-old client purchased a variable life insurance policy. Under current regulations, the maximum sales charge permitted over the life of the policy is

A variable life insurance plan may include a maximum sales charge of 9% over a period not to exceed 20 years. It may be loaded as much as 50% of the first year's premium but must average no more than 9% over the first 20 years.

Which of the followings measures should be used to assess the risk-adjusted return of an active portfolio manager?

Alpha

When analyzing a security's standard deviation, which of the following statements accurately describes observations according to a normal frequency distribution curve?

Approximately two-thirds, or 68.26%, of observations will be within one standard deviation on either side of the mean. Approximately 95% will be within two standard deviations and approximately 99% will be within three.

What is the latest date that an IRA participant may make a contribution based on the current year's income?

April 15 of the following year or the first business day following if the 15th is a Saturday or Sunday

The Canadian government is looking to create their own digital coin that will allow them to regulate digital assets safely and securely. What is the name of this developing stablecoin?

Central Bank Digital Currency

Which of the following is considered the most accurate method of measuring GDP?

Constant dollars

In the investment industry, the term spread has many different meanings. When used in a discussion about bonds, which of the following would be most appropriate?

Credit spread

Which of the following does NOT constitute market manipulation under the NASAA Statement of Policy on Dishonest or Unethical Business Practices of Broker-Dealers and Agents?

Excessive trading in a client's account for the sole benefit of increasing commission income.

In addition to the normal required filings, an investment adviser who maintains custody of client funds or securities will be required to complete

Form ADV-E.

Which of the following is a risk common to all fixed-income securities?

Interest rate risk

Under the Uniform Securities Act, which of the following must register with the state securities Administrator?

Investment advisers with a place of business in the state and less than $100 million in assets under management

Bachelier and Louis Associates, BALA, is an investment adviser registered in States W, X, and Y. BALA is completing the Form ADV to register in State Z. Which of these would be automatically registered as an investment adviser representative in State Z simultaneously with BALA's effective registration?

Louise, vice president of the company's sales department

Which of the following methods of calculating investment returns are discounted cash flow (DCF) techniques?

Net present value (NPV) & Internal rate of return (IRR)

Which of the following is not an annuity purchase option?

Periodic payment immediate annuity

Under the NASAA Model Rule on Custody Requirements for Investment Advisers, if an investment adviser has custody of customer funds and securities, how often must the adviser send the customer a statement of account activity?

Quarterly

An investor has bonds maturing in three weeks on the first day of the upcoming month. Since his purchase of the bonds five years ago, interest rates have fallen. To which one of these risks are these bonds most likely to be subject?

Reinvestment risk is the risk associated with reinvesting interest and/or principal payments when interest rates have fallen. On the upcoming maturity date, the investor will receive the par value of the bonds plus the final interest payment. When looking to reinvest the proceeds, it will be at current market interest rates which, as the question states, are lower than what the bonds had been paying

Which of the following must be considered in evaluating the suitability of a DPP investment for a customer?

Risk tolerance Other holdings Financial situation Age

Which of the following statements regarding the general partner (GP) in a direct participation program (DPP) is not true?

The GP, as the active manager of the partnership, does not maintain a financial interest in the partnership and only receives income distributions from profits on the business prior to the limited partners.

Which of the following best describes the economic phase in which unemployment increases and businesses operate at their lowest capacity levels?

Trough

Twelve years ago, an investor placed $2,500 into an account. The account is now worth $10,000. Using the Rule of 72, you can determine that the approximate annual return was

Under the Rule of 72, we can determine an earnings rate by dividing 72 by the number of years it takes for money to double. In this case, the money had quadrupled. That means it has doubled twice in 12 years or, every 6 years. Dividing 72 by 6 years results in an annual return of 12%.

Which of the following is likely to be characterized by no management fees and a portfolio consisting of municipal or corporate bonds?

Unit investment trust

A corporation ends its accounting year on September 30. It would be correct to state that it uses

a fiscal year. Fiscal-year accounting is the term used to describe whenever an entity ends its accounting year on a date other than December 31.

Beta is

a measure of relative systematic risk for stock or portfolio returns.

In a scheduled premium variable life insurance policy, all of the following are guaranteed except

a minimum cash value

An investment adviser has devised a charting system and wishes to advertise this fact in order to obtain additional clients. To do so, the USA would require

a statement as to the limitations of and difficulties involved in using this system.

Current liabilities on a company's balance sheet would include

accounts payable. are those that are expected to be paid within a normal operating cycle and would include accounts payable. A mortgage payable is a liability, but it is a long-term debt and would be included in fixed or long-term liabilities. Accounts receivable and prepaid expenses are current assets.

A retired person seeking to maximize income with reasonable safety and liquidity should most likely consider investing in

an intermediate-term, high-grade corporate bond fund

One of your clients just inherited some money and wishes to invest $250,000 into the GEMCO International Equity Fund. The client is attracted to the Class B shares because there is no up-front sales charge on them, while the Class A shares have a 3% front-end load. The appropriate response would be that

because of the higher 12b-1 charges levied against the Class B shares as well as the CDSC, Class A shares are recommended for a purchase of this size.

interest rates tend to decline

contraction

Specific or unsystematic risk refers to investment risk that is

diversifiable

When a stock is listed on the New York Stock Exchange, it is

exempt from state registration requirements.

interest rates tend to rise

expansions

If you had expectations of high inflation, you would

increase equity exposure and reduce fixed income exposure

Institutional investors are never

individuals

purchasing power is also

inflation risk because they have limited opportunity for capital appreciation. (cash & cash equivalents)

The main difference between the current ratio and the quick ratio is that the quick ratio excludes

inventory.

If a stock has a beta of less than 1.0, the stock's price will

not increase as much as the market when the market is up

The tax consequence of transferring proceeds from one fund to another within the same family of funds is

on the date of the transaction, any gain or loss is recognized for tax purposes.

A federal covered investment adviser (IA) has decided that it is necessary to increase its fee schedule and charge commissions on securities trades. However, they are going to leave the fee structure in place for existing customers. This information must be disclosed

promptly only to those customers who will be affected by the change through an amended brochure.

When reviewing a corporation's financial statements, shareholders' equity is computed by

subtracting total liabilities from total assets.

An analytical tool used to project the current value of a common stock using projected future dividends is

the dividend discount model

If a security has an anticipated return of 8.7% and a standard deviation of 14.6%, you would expect the returns to have a 95% probability (assuming a normal distribution) of falling between

−20.5 and +37.9% A security with a normal distribution has a 95% probability of falling within 2 standard deviations of its anticipated return. In this case, that would be −20.5% and +37.9%, which is computed by calculating return movements of 29.2% (14.6 × 2) in either direction. LO 20.f