Question 1

Saheed is a retiree who is considering splitting his pension income with his wife, Minu. Which of the following outcomes may occur if he shares his pension benefits?

Options :

A : Whether the couple saves on income tax will be dependent on Minu’s marginal tax rate.

B : Minu will be exposed to a pension adjustment (PA) if she receives income from his pension

C : This is a form of tax evasion and is therefore considered illegal based on income tax legislation

D : Regardless of how much income each person reports, the total amount of income taxes will not change.

Answer: A

Question 2

Catarina is a Dealing Representative for Ethical Financial which represents 20 different mutual fund families. Darlene is a fund manager from one of those mutual fund families and wants to send a gift card to Catarina as a symbol of appreciation. Ethical Financial's policies and procedures manual (PPM) require that Catarina decline the gift. What method of addressing conflict of interest is being used by Ethical Financial?

Options :

A : Potential

B : Disclosure

C : Avoidance

D : Control

Answer: C

Question 3

During the calendar year, Firmansyah received a $1,800 eligible dividend from a large Canadian bank and a foreign, dividend from his The USD/CAD exchange rates is 1.3605. Firmansyah’s federal marginal tax bracket is 29%. The enhanced dividend gross-up rate is 38% and the federal dividend tax credit rate for eligible dividends is 15%. What federal tax liability will be due from the investment income?

Options :

A : $522.00

B : $348.00

C : $695.76

D : $870.00

Answer: C

Question 4

Kendrick is a newly registered Dealing Representative for Oak Solid Financial. He has been assigned the task of contacting existing clients where there has been no record of consultation within the last 12 months. The first person he sees on his list is a client named Chandra Ruffino. He double-checks if her phone number is on the Do Not Call List (DNCL) registry. Which of the following statements apply?

Options :

A :

If Chandra is on the DNCL registry, Kendrick is still eligible to contact the client of Oak Solid Financial.

B : If Chandra has been on the DNCL registry for 18 months, then Kendrick is not allowed to contact her.

C : If Chandra is on the DNCL, then Kendrick can only contact her if she is specifically his client.

D :

If Chandra had closed her account within the last 12 months and registered herself on the DNCL, then Kendrick cannot call her.

Answer: A

Question 5

Exchange traded funds (ETFs) that track an index and index mutual funds have many similarities. However, what is a major difference between these two products?

Options :

A : While ETFs are prone to tracking errors, index funds are perfectly aligned with their underlying index

B :

ETFs can be purchased continuously throughout the trading day while index funds can only be bought or sold at the end of the day.

C :

The market price of ETFs always matches the underlying basket of securities while there can be a discrepancy in pricing index funds.

D : ETFs do not have management fees since they are exchange traded while index funds do incur such fees.

Answer: B

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