Question No 1

Xian - Li believes she is a sophisticated investor. She has constructed her own portfolio and has had some success. She does not believe in studying a company’s details such as earnings, expenses, or assets. She is more concerned with patterns in a company’s stock price over time. She believes patterns form and can be used to predict future movements in the market. How does Xian - Li evaluate the companies in her portfolio?

Choose the Choices:

Question No 2

Yesterday, Mariana purchased mutual funds for the first time from Diablo, who is a Dealing Representative for Horizon Financial. When Mariana mentions to her friend Marcus that she just started to invest, Marcus confides that he experienced losses from mutual fund investing. Her initial feelings of excitement have now changed to worry and regret. She wished she had talked to her friend before investing and wonders if she can change her mind. Which statement regarding the right of withdrawal applies?

Choose the Choices:

The right of withdrawal is based on the securities act legislation within the jurisdiction the purchase occurred.

Before Mariana can cancel her order, she must wait two business days to pass before she can cancel her order.

How the right of withdrawal can be applied is determined by the Mutual Fund Dealers Association of Canada's conduct rules.

The Canadian Securities Administrators have instituted national instruments regarding Mariana's right to cancel her order.

Question No 3

Iliana owns 1,000 participating preferred shares in the First Canadian Bank. Which of the following features are characteristic of her investment?

Choose the Choices:

Iliana has the right to purchase more preferred shares in the company before common shareholders.

Iliana is able to vote at the annual general meeting and elect members of the board of directors.

Iliana can convert her preferred shares to common shares at a fixed price and within a specified time period.

Iliana has a right to share in the bank's net profits over and above the specified dividend rate.

Question No 4

Wilma has always used the services of a tax preparation firm to file her taxes but is skeptical that she has really benefitted. This year she plans to file her own taxes for the first time. What would be useful for her to know?

Choose the Choices:

Wilma's marginal tax rate may be lowered when tax deductions are applied to her total income.

Wilma's top marginal tax rate will be applied to every taxable dollar when her tax return is filed.

Wilma's tax deductions permit her to reduce her tax payable dollar - for - dollar.

Wilma's non - refundable tax credits may only reduce her taxable income dollar - for - dollar.

Question No 5

One of your clients, Fernando, is approaching 71 years of age and has a few questions regarding life income funds (LIFs). Which of the following statements about LIFs is TRUE?

Choose the Choices:

Fernando may make contributions to his LIF if he continues working.

Fernando is free to withdraw any amount from his LIF above the minimum amount.

Fernando can transfer money from his registered retirement savings plan (RRSP) to a LIF.

Fernando can transfer money from his locked - in retirement account (LIRA) to a LIF.

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