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Practice Test AAFM - CWM_LEVEL_2 Question #:1 Section A (1 Mark) Mr.Gopal is working in a reputed company and earning Rs. 3,00,000/- p.a. and is now 48 years old. He has invested Rs. 3,00,000/- in an annuity which will pay him after 5 years a certain amount p.m. at the end of every month for 10 years. Rate of interest is 8% p.a. Calculate how much he will receive at the end of every month after 5 years? A. 5,355 B. 5423 C. 5691 D. 5487 Answer: A Question #:2 Section A (1 Mark) Holistic advisory services which cater to specific client segments such as entrepreneurs, professionals are known as_______________. A. Universal Banks B. Family Office C. Global Investment Banks D. Wealth management Specialists Answer: B Question #:3 Section B (2 Mark) If two customers choose exactly the same package of certain service, but customer A calls for help weekly and customer B calls only twice a year, which is most valuable customer? A. Both A & B customer B. Customer A 1 of 5
Practice Test AAFM - CWM_LEVEL_2 C. Customer B D. None of the above Answer: C Question #:4 Section B (2 Mark) Mr. X gives Rs. 200000 to Mrs. X as gift. She invests in a proprietary concern and incurs a loss of Rs. 40000. A. The loss shall be ignored while computing income of both Mr. and Mrs. X B. The loss shall be borne by Mrs. X C. The loss shall not be clubbed D. This loss shall be clubbed in the hands of Mr. X Answer: D Question #:5 Section C (4 Mark) Read the senario and answer to the question. Pallavi’s marriage is expected by the end of December, 2010 with an expected present cost of Rs. 24,00,000. He is expected to realize from his Tatanagar Flat 18, 00,000 by that time. Calculate what additional amount is required for his daughter’s marriage. With 8% pa. risk free rate compounding monthly what amount he has to save per month (BEGIN) in a debt fund? A. Rs. 2,27,367 Rs. 7,663 B. Rs. 3,83,365 Rs. 9,815 C. Rs. 4,12,245 Rs. 8,615 D. Rs. 3,45,458 Rs. 11,363 Answer: A Question #:6 2 of 5
Practice Test AAFM - CWM_LEVEL_2 Section C (4 Mark) Mr. A bought XYZ Ltd. For Rs. 3850 and simultaneously sells a call option at an strike price of Rs. 4000. Which means Mr. A does not think that the price of XYZ Ltd. will rise above Rs. 4000. However, incase it rises above Rs. 4000, Mr. A does not mind getting exercised at that price and exiting the stock at Rs. 4000 (Target Sell Price = 3.90% return on the stock purchase price). Mr. A receives a premium of Rs. 80 for selling the call. Thus net outflow to Mr. A is (Rs. 3850 – Rs. 80) = Rs. 3770. He reduces the cost of buying the stock by this strategy. What would be the Net Payoff of the Strategy? • If XYZ closes at 3350 • If XYZ closes at 4800 A. -420 and 230 B. -240 and 130 C. 220 and 145 D. 520 and 170 Answer: A Question #:7 Section A (1 Mark) A cognitive heuristic in which decisions are made based on how representative a given individual case appears to be independent of other information about its actual likelihood. We tend to think that trends we observe are likely to continue. Which of the following is most likely consistent with this bias? A. Anchoring and Adjustment Bias B. mental accounting C. Representativeness Bias D. hindsight bias Answer: C Question #:8 Section C (4 Mark) 3 of 5
Practice Test AAFM - CWM_LEVEL_2 Read the senario and answer to the question. Mrs. Deepika’s brother is impressed with Manav Fashion Ltd. an online clothing firm that focuses on the 18–22 age bracket. Their prices are much lower than their competitors, and the quality is high. Reading about the firm on its web site and in various financial newspapers, her brother has learned that the company plans to expand its clothing lines. The prevailing price of its share is 70 per share. Manav Fashion Ltd. has had recent annual earnings of Rs. 5 per share. Only three other companies have very similar business to Manav Fashion Ltd. and have stock that is traded and there PE ratios are as follows: Her brother asked Mrs. Deepika to guide him in investing the Manav Fashion Ltd. Getting the query from her brother Mrs. Deepika asks your advice on this matter. As a Chartered Wealth Manager what will be your advice? A. Invest in shares of Manav Fashion Ltd. B. Not to invest in shares of Manav Fashion Ltd C. Manav Fashion Ltd’s share valuation is less than prevailing price, so it is an option not to miss. D. Manav Fashion Ltd’s share valuation is less than prevailing price, so it is an option not to be availed. Answer: D Question #:9 Section C (4 Mark) Read the senario and answer to the question. Nimita purchased 500 shares of ABC Ltd., a listed company at Rs. 45 per share on Sep. 15,2002. The company offered to buy back its shares on June 15, 2009 which Nimita accepted at a price of Rs. 75 per share on Jul 1, 2009. What is the tax liability in the hands of Nimita for this transaction for Assessment Year 2010-11? Cost inflation indices are 2002-03: 447 and 2009-10 632. (Ignore Education Cess) A. Rs. 1,140 B. Rs. 3,000 C. Rs. 1,500 4 of 5
Practice Test AAFM - CWM_LEVEL_2 D. Nil Answer: A Question #:10 Section A (1 Mark) When loans are securitized they are passed on to a ____________who pools the loans and sells securities. A. Multi Purpose Vehicle B. Deemed Entity C. Special Purpose Entity D. None of the Above Answer: C https://www.dumpspass4sure.com/microsoft/mb-920-dumps.html 5 of 5