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BUSI 352 - Exam 1 Study Guide With 100% Correct Answers | Verified
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BUSI 352 - Exam 1 Study Guide With 100% Correct Answers | Verified
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BUSI 352 - Exam 1 Study Guide With100% Correct Answers | Verified
(T/F) One definition of financial planning is cash flow planning CORRECT ANSWERS
true
(T/F) A good financial plan is one that shows the client how to achieve all his or her
goals CORRECT ANSWERS False
(T/F) A couple who is retired and whose cash flow is from an Individual Retirement
Account (IRA) should have the investments in the IRA structured for maximum
appreciation CORRECT ANSWERS False
(T/F) It is easy for most individuals approaching their retirement date to significantly
reduce their lifestyle CORRECT ANSWERS False
(T/F) There are many different acceptable definitions of the term "financial planning"
CORRECT ANSWERS true
(T/F) According to the authors, financial planning is a process, not a product or service
CORRECT ANSWERS true
(T/F) Clients have better chances of meeting their objectives if the objectives are
realistic, well-defined and measurable CORRECT ANSWERS True
(T/F) The authors recommend prioritizing client goals as well as attaching a time frame
to each goal CORRECT ANSWERS true
(T/F) A client's income statement and net worth are more important planning
considerations than feelings about investment risk, financial security, and independence
CORRECT ANSWERS False
(T/F) Determining the amount of savings needed to meet emergencies or for other
special needs is something easily determined CORRECT ANSWERS False
(T/F) The financial planner must always assume the role of the quarterback of the
financial planning team CORRECT ANSWERS False
(T/F) Automatic investment plans are a more effective way to build wealth than
discretionary investments as they allow clients to put aside money before they consider
spending it CORRECT ANSWERS True
(T/F) The philosophy of "owning, not loaning" is the belief that fixed income investments
are a better alternative to equities for building wealth CORRECT ANSWERS False
, (T/F) Dollar cost averaging injects discipline into the investment process CORRECT
ANSWERS True
(T/F) The debt repayment is essentially a risk-free investment CORRECT ANSWERS
True
(T/F) If you hold yourself out to the public as a financial planner, you lose the exemption
from registration even if you otherwise qualify CORRECT ANSWERS true
(T/F) A financial planner, who registered with the SEC as an investment advisor,
decided to sell his practice and retire. He may assign all his clients to the buyer without
obtaining the client's permission CORRECT ANSWERS False
(T/F) The Act specially forbids the use of testimonials in advertising by registered
investment advisors CORRECT ANSWERS True
(T/F) The investment advisor is a fiduciary in the eyes of the SEC CORRECT
ANSWERS True
(T/F) Financial Planners who advise clients who are residents of multiple states about
insurance must obtain a national insurance license CORRECT ANSWERS False
(T/F) The financial planner must analyze the client's finances to determine the
appropriate lifestyle for him or her. CORRECT ANSWERS False
(T/F) Planning for contingencies in case the chosen strategies are not successful is an
essential element of a good financial plan CORRECT ANSWERS True
(T/F) Allocation of less than 50% of current resources to the client's lifestyle is an
indication that the client has the potential for building significant assets through savings
and investments CORRECT ANSWERS True
(T/F) People who were impacted by the Great Recession tend to have children who are
spendthrifts CORRECT ANSWERS False
(T/F) For fixed, required (like housing) expenses there are no options available for
clients CORRECT ANSWERS False
(T/F) Mike and Laura are going through an amicable divorce, and have decided to
divide all assets equally between them. Even though this seems fair, there tax burdens
may turn out to be unequal CORRECT ANSWERS Tru
(T/F) Alimony is taxable to the recipient while child support is not CORRECT
ANSWERS True
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