Question 1

Because exchange-traded funds (ETFs)are passively managed,they are a good choice for an investor who is looking for tax efficiency.

Accepted Answer

A) True 
 B)False  True

Question 2

Hedge funds use risky strategies to successfully earn high returns for wealthy investors.

Accepted Answer

A) True 
 B)False  False

Question 3

You own 600 units of a fund with a current NAV of $14.36.Your portion of the fund distributions is $718.00 of dividends,capital gains,and interest earnings.What will be your total units now?

Accepted Answer

A) 600 units 
B) 605 units 
C) 550 units 
D) 650 units 
A) 600 units 
B) 605 units 
C) 550 units 
D) 650 units D

Question 4

Which of the following bond mutual funds has highest risk?

Accepted Answer

A) High-yield bond funds 
B) Canadian bond funds 
C) Canadian corporate bond index fund 
D) Canadian long-term bond index fund 
A) High-yield bond funds 
B) Canadian bond funds 
C) Canadian corporate bond index fund 
D) Canadian long-term bond index fund

Question 5

Segregated funds are insurance products,but similar to mutual funds,and offer a guarantee of as much as 100 percent of the funds invested upon maturity or the death of the owner.

Accepted Answer

A) True 
 B)False

Question 6

A conservative investor should only invest in a variety of bond mutual funds.

Accepted Answer

A) True 
 B)False

Question 7

Three and a half years ago you purchased 1200 units of a fund with a NAV of $16.75.The NAV is now $34.50 and the fund had a 6 percent redemption fee declining at 1 percent per year and based on the value of the holdings at the time of the transaction.What will be the proceeds if you sell it today?

Accepted Answer

A) $38 744 
B) $41 400 
C) $40 158 
D) $40 797 
A) $38 744 
B) $41 400 
C) $40 158 
D) $40 797

Question 8

Which of the following must be considered before assessing the skills of equity fund managers?

Accepted Answer

A) The industry sectors held in the funds 
B) The interest yield curve 
C) The P/E ratios of key market sectors 
D) The average dividend payout ratios 
A) The industry sectors held in the funds 
B) The interest yield curve 
C) The P/E ratios of key market sectors 
D) The average dividend payout ratios

Question 9

Which of the following applies to hedge funds?

Accepted Answer

A) They are regulated similarly to mutual funds. 
B) They are appropriate for business owners who could benefit from creditor protection. 
C) They are not regulated by a securities commission. 
D) They use leverage and hedging to guarantee above average returns. 
A) They are regulated similarly to mutual funds. 
B) They are appropriate for business owners who could benefit from creditor protection. 
C) They are not regulated by a securities commission. 
D) They use leverage and hedging to guarantee above average returns.

Question 10

While not all mutual funds have loads or commissions,they all have management fees and expenses that are charged to the mutual fund shareholders.

Accepted Answer

A) True 
 B)False

Question 11

Mutual funds,which sell units directly to investors and repurchase units from investors who want to sell,are called

Accepted Answer

A) open-market funds. 
B) open-end funds. 
C) closed-end funds. 
D) fair value funds. 
A) open-market funds. 
B) open-end funds. 
C) closed-end funds. 
D) fair value funds.

Question 12

There are three ways that taxable income can be generated for investors in mutual funds without the investor actually receiving any income.

Accepted Answer

A) True 
 B)False

Question 13

In most cases,the fees charged by load funds have no impact on the overall return of your investment.

Accepted Answer

A) True 
 B)False

Question 14

MERs can be high due to high sales and marketing expenses or due to research costs such as for researching international companies.

Accepted Answer

A) True 
 B)False

Question 15

Studies on mutual funds have found that the management expense ratio (MER)has no relationship to overall fund performance.

Accepted Answer

A) True 
 B)False

Question 16

The return on an index fund may be less than the return on the index it represents because of

Accepted Answer

A) tracking errors and costs. 
B) management fees. 
C) load fees. 
D) dividends and taxation. 
A) tracking errors and costs. 
B) management fees. 
C) load fees. 
D) dividends and taxation.

Question 17

Global bond funds potentially offer higher yields than Canadian bond funds,but have higher MERs and more risk.

Accepted Answer

A) True 
 B)False

Question 18

In order to select appropriate mutual funds for yourself,you should determine your investment objectives,evaluate your risk tolerance,and the final step is to

Accepted Answer

A) review and compare key information from the relevant Fund Facts documents. 
B) review and compare key information from the simplified prospectuses. 
C) open an account with a broker. 
D) consult a certified financial planner. 
A) review and compare key information from the relevant Fund Facts documents. 
B) review and compare key information from the simplified prospectuses. 
C) open an account with a broker. 
D) consult a certified financial planner.

Question 19

Which of the following is a stock mutual fund?

Accepted Answer

A) Asset allocation fund 
B) Balanced growth and income 
C) Mid-cap fund 
D) Money market fund 
A) Asset allocation fund 
B) Balanced growth and income 
C) Mid-cap fund 
D) Money market fund

Question 20

Treasury bill funds have

Accepted Answer

A) high liquidity and inflation risk and low default risk. 
B) high interest rate risk and low default risk. 
C) low interest rate risk and default risk. 
D) low interest rate risk,no default risk and high inflation risk. 
A) high liquidity and inflation risk and low default risk. 
B) high interest rate risk and low default risk. 
C) low interest rate risk and default risk. 
D) low interest rate risk,no default risk and high inflation risk.

Because exchange-traded funds (ETFs)are passively managed,they are a good choice for an investor who is looking for tax efficiency.

Hedge funds use risky strategies to successfully earn high returns for wealthy investors.

You own 600 units of a fund with a current NAV of $14.36.Your portion of the fund distributions is $718.00 of dividends,capital gains,and interest earnings.What will be your total units now?

Which of the following bond mutual funds has highest risk?

Segregated funds are insurance products,but similar to mutual funds,and offer a guarantee of as much as 100 percent of the funds invested upon maturity or the death of the owner.

A conservative investor should only invest in a variety of bond mutual funds.

Three and a half years ago you purchased 1200 units of a fund with a NAV of $16.75.The NAV is now $34.50 and the fund had a 6 percent redemption fee declining at 1 percent per year and based on the value of the holdings at the time of the transaction.What will be the proceeds if you sell it today?

Which of the following must be considered before assessing the skills of equity fund managers?

Which of the following applies to hedge funds?

While not all mutual funds have loads or commissions,they all have management fees and expenses that are charged to the mutual fund shareholders.

Mutual funds,which sell units directly to investors and repurchase units from investors who want to sell,are called

There are three ways that taxable income can be generated for investors in mutual funds without the investor actually receiving any income.

In most cases,the fees charged by load funds have no impact on the overall return of your investment.

MERs can be high due to high sales and marketing expenses or due to research costs such as for researching international companies.

Studies on mutual funds have found that the management expense ratio (MER)has no relationship to overall fund performance.

The return on an index fund may be less than the return on the index it represents because of

Global bond funds potentially offer higher yields than Canadian bond funds,but have higher MERs and more risk.

In order to select appropriate mutual funds for yourself,you should determine your investment objectives,evaluate your risk tolerance,and the final step is to

Which of the following is a stock mutual fund?

Treasury bill funds have

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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Exam 13: Personal Investing - Investing in Mutual Funds

Because exchange-traded funds (ETFs)are passively managed,they are a good choice for an investor who is looking for tax efficiency.

Hedge funds use risky strategies to successfully earn high returns for wealthy investors.

You own 600 units of a fund with a current NAV of $14.36.Your portion of the fund distributions is $718.00 of dividends,capital gains,and interest earnings.What will be your total units now?

Which of the following bond mutual funds has highest risk?

Segregated funds are insurance products,but similar to mutual funds,and offer a guarantee of as much as 100 percent of the funds invested upon maturity or the death of the owner.

A conservative investor should only invest in a variety of bond mutual funds.

Three and a half years ago you purchased 1200 units of a fund with a NAV of $16.75.The NAV is now $34.50 and the fund had a 6 percent redemption fee declining at 1 percent per year and based on the value of the holdings at the time of the transaction.What will be the proceeds if you sell it today?

Which of the following must be considered before assessing the skills of equity fund managers?

Which of the following applies to hedge funds?

While not all mutual funds have loads or commissions,they all have management fees and expenses that are charged to the mutual fund shareholders.

Mutual funds,which sell units directly to investors and repurchase units from investors who want to sell,are called

There are three ways that taxable income can be generated for investors in mutual funds without the investor actually receiving any income.

In most cases,the fees charged by load funds have no impact on the overall return of your investment.

MERs can be high due to high sales and marketing expenses or due to research costs such as for researching international companies.

Studies on mutual funds have found that the management expense ratio (MER)has no relationship to overall fund performance.

The return on an index fund may be less than the return on the index it represents because of

Global bond funds potentially offer higher yields than Canadian bond funds,but have higher MERs and more risk.

In order to select appropriate mutual funds for yourself,you should determine your investment objectives,evaluate your risk tolerance,and the final step is to

Which of the following is a stock mutual fund?

Treasury bill funds have

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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