Question 1

The operating ratio is the combined ratio less than the ratio of investment income, to earned premiums.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following id NOT the kind of Insurance?

Accepted Answer

A)  Business policies 
B)  fire and alliance lines 
C)  inland marine 
D)  professional liability 
A)  Business policies 
B)  fire and alliance lines 
C)  inland marine 
D)  professional liability

Question 3

The delivery of medical and personal care, other than hospital care, to persons with chronic medical conditions resulting from either illness or frailty is called:

Accepted Answer

A)  Short-term care 
B)  Basic care 
C)  Long-term care 
D)  Guaranteed renewability 
A)  Short-term care 
B)  Basic care 
C)  Long-term care 
D)  Guaranteed renewability

Question 4

Which of the following statements regarding covariance is correct?

Accepted Answer

A)  Covariance always lies in the range -1 to +1 
B)  Covariance, because it involves a squared value, must always be a positive number (or zero) 
C)  Low co-variances among returns for different securities leads to high portfolio risk 
D)  Co-variances can take on positive, negative, or zero values 
A)  Covariance always lies in the range -1 to +1 
B)  Covariance, because it involves a squared value, must always be a positive number (or zero) 
C)  Low co-variances among returns for different securities leads to high portfolio risk 
D)  Co-variances can take on positive, negative, or zero values

Question 5

Personal trust accounts may be:

Accepted Answer

A)  Living or testamentary 
B)  Revocable or irrevocable 
C)  Both of these 
D)  None of these 
A)  Living or testamentary 
B)  Revocable or irrevocable 
C)  Both of these 
D)  None of these

Question 6

Which of the following is not a type of the multistage dividend discount model?

Accepted Answer

A)  Two-stage models 
B)  Y models 
C)  H models 
D)  Three-stage models 
A)  Two-stage models 
B)  Y models 
C)  H models 
D)  Three-stage models

Question 7

An equity analyst working for a growth oriented mutual fund has a tendency to misvalue the stocks of popular companies that she has previously recommended and the fund already owns. Her behavior is most likely consistent with which of the following biases?

Accepted Answer

A)  Escalation bias 
B)  Prospect theory 
C)  Confirmation bias 
D)  Probability bias 
A)  Escalation bias 
B)  Prospect theory 
C)  Confirmation bias 
D)  Probability bias

Question 8

Primary coverage involves policies written between an insurer and a customer directly.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following may Not involve a high degree of management judgment and subjectivity and may present risks of material misstatement due to fraud?

Accepted Answer

A)  Investments 
B)  Deferred acquisition costs 
C)  Reinsurance 
D)  key estimates 
A)  Investments 
B)  Deferred acquisition costs 
C)  Reinsurance 
D)  key estimates

Question 10

Securities market is a market place in which stocks, bonds, and other financial instruments are traded. Such markets can be:

Accepted Answer

A)  Physical businesses 
B)  Electronic businesses 
C)  Having outstanding securities 
D)  All of these 
A)  Physical businesses 
B)  Electronic businesses 
C)  Having outstanding securities 
D)  All of these

Question 11

Which of the following statements concerning remote disbursement and controlled disbursement is correct?

Accepted Answer

A)  These two terms mean the same thing--just like working capital means the same thing as current assets 
B)  Remote disbursement is viewed as an ethical disbursement procedure, whereas controlled disbursement is often viewed as an unethical disbursement procedure 
C)  Both remote and controlled disbursement are generally perceived as unethical practices and, therefore, their use is in decline 
D)  Remote disbursement is often viewed as an unethical disbursement procedure, whereas controlled disbursement is not viewed in such a negative light 
A)  These two terms mean the same thing--just like working capital means the same thing as current assets 
B)  Remote disbursement is viewed as an ethical disbursement procedure, whereas controlled disbursement is often viewed as an unethical disbursement procedure 
C)  Both remote and controlled disbursement are generally perceived as unethical practices and, therefore, their use is in decline 
D)  Remote disbursement is often viewed as an unethical disbursement procedure, whereas controlled disbursement is not viewed in such a negative light

Question 12

In which of the following charts days do not matter?

Accepted Answer

A)  Line and pie charts 
B)  Bar and pie charts 
C)  Bar and line charts 
D)  Point and figure charts 
A)  Line and pie charts 
B)  Bar and pie charts 
C)  Bar and line charts 
D)  Point and figure charts

Question 13

Which of the following moves inversely to each other?

Accepted Answer

A)  Interest rate and debt to equity ratio 
B)  Discount rate and P/E ratio 
C)  Coupon rate and leverage ratios 
D)  Interest rate and activity ratios 
A)  Interest rate and debt to equity ratio 
B)  Discount rate and P/E ratio 
C)  Coupon rate and leverage ratios 
D)  Interest rate and activity ratios

Question 14

Audit risk consists of:

Accepted Answer

A)  Risk of material misstatement 
B)  detection of risk 
C)  Both A & B 
D)  Neither A nor B 
A)  Risk of material misstatement 
B)  detection of risk 
C)  Both A & B 
D)  Neither A nor B

Question 15

A UIT typically issues redeemable securities (or "units"), like a mutual fund, which means:

Accepted Answer

A)  That the UITs typically will make a one-time "public offering" 
B)  A UIT does not activity trade its investment portfolio 
C)  That the UIT will, buy back an investor's request at their approximate net asset value 
D)  All of these 
A)  That the UITs typically will make a one-time "public offering" 
B)  A UIT does not activity trade its investment portfolio 
C)  That the UIT will, buy back an investor's request at their approximate net asset value 
D)  All of these

Question 16

Which of the following is the income that is the source of revenue for the members or the brokers?

Accepted Answer

A)  Commission 
B)  Copyright fee 
C)  Application fee 
D)  Fixed cost fee 
A)  Commission 
B)  Copyright fee 
C)  Application fee 
D)  Fixed cost fee

Question 17

If you commit $200 to an investment at the beginning of the year, what is your rate of return for the period?

Accepted Answer

A)  1.10 
B)  1.50 
C)  1.00 
D)  1.70 
A)  1.10 
B)  1.50 
C)  1.00 
D)  1.70

Question 18

Outgoing premiums less return premiums arising from reinsurance purchased from other insurance entities are called:

Accepted Answer

A)  Rating premiums 
B)  Direct premiums 
C)  Assumed reinsurance premiums 
D)  Ceded reinsurance premiums 
A)  Rating premiums 
B)  Direct premiums 
C)  Assumed reinsurance premiums 
D)  Ceded reinsurance premiums

Question 19

It is an automobile insurance that reimburses the parties involved in an accident without regard to negligence.

Accepted Answer

A)  No-fault automobile insurance 
B)  Comprehensive automobile insurance 
C)  Collision insurance 
D)  Automobile accidental damage coverage 
A)  No-fault automobile insurance 
B)  Comprehensive automobile insurance 
C)  Collision insurance 
D)  Automobile accidental damage coverage

Question 20

A broker who, in addition to executing clients' transactions, offers a full array of brokerage services is:

Accepted Answer

A)  Full-service broker 
B)  Discount broker 
C)  Online broker 
D)  OTC broker 
A)  Full-service broker 
B)  Discount broker 
C)  Online broker 
D)  OTC broker

The operating ratio is the combined ratio less than the ratio of investment income, to earned premiums.

Which of the following id NOT the kind of Insurance?

The delivery of medical and personal care, other than hospital care, to persons with chronic medical conditions resulting from either illness or frailty is called:

Which of the following statements regarding covariance is correct?

Personal trust accounts may be:

Which of the following is not a type of the multistage dividend discount model?

An equity analyst working for a growth oriented mutual fund has a tendency to misvalue the stocks of popular companies that she has previously recommended and the fund already owns. Her behavior is most likely consistent with which of the following biases?

Primary coverage involves policies written between an insurer and a customer directly.

Which of the following may Not involve a high degree of management judgment and subjectivity and may present risks of material misstatement due to fraud?

Securities market is a market place in which stocks, bonds, and other financial instruments are traded. Such markets can be:

Which of the following statements concerning remote disbursement and controlled disbursement is correct?

In which of the following charts days do not matter?

Which of the following moves inversely to each other?

Audit risk consists of:

A UIT typically issues redeemable securities (or "units"), like a mutual fund, which means:

Which of the following is the income that is the source of revenue for the members or the brokers?

If you commit $200 to an investment at the beginning of the year, what is your rate of return for the period?

Outgoing premiums less return premiums arising from reinsurance purchased from other insurance entities are called:

It is an automobile insurance that reimburses the parties involved in an accident without regard to negligence.

A broker who, in addition to executing clients' transactions, offers a full array of brokerage services is:

Certified Regulatory Compliance Manager

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Exam 2: Certified Trust and Financial Advisor

The operating ratio is the combined ratio less than the ratio of investment income, to earned premiums.

Which of the following id NOT the kind of Insurance?

The delivery of medical and personal care, other than hospital care, to persons with chronic medical conditions resulting from either illness or frailty is called:

Which of the following statements regarding covariance is correct?

Personal trust accounts may be:

Which of the following is not a type of the multistage dividend discount model?

An equity analyst working for a growth oriented mutual fund has a tendency to misvalue the stocks of popular companies that she has previously recommended and the fund already owns. Her behavior is most likely consistent with which of the following biases?

Primary coverage involves policies written between an insurer and a customer directly.

Which of the following may Not involve a high degree of management judgment and subjectivity and may present risks of material misstatement due to fraud?

Securities market is a market place in which stocks, bonds, and other financial instruments are traded. Such markets can be:

Which of the following statements concerning remote disbursement and controlled disbursement is correct?

In which of the following charts days do not matter?

Which of the following moves inversely to each other?

Audit risk consists of:

A UIT typically issues redeemable securities (or "units"), like a mutual fund, which means:

Which of the following is the income that is the source of revenue for the members or the brokers?

If you commit $200 to an investment at the beginning of the year, what is your rate of return for the period?

Outgoing premiums less return premiums arising from reinsurance purchased from other insurance entities are called:

It is an automobile insurance that reimburses the parties involved in an accident without regard to negligence.

A broker who, in addition to executing clients' transactions, offers a full array of brokerage services is:

Certified Regulatory Compliance Manager

Filters