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AAMS Practice 2 2025 Solution solved 100% Passed!!
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AAMS Practice 2 2025 Solution solved 100% Passed!!
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Passed!!2024/2025
AAMS Practice 2
Which of the following is a false statement regarding a good business plan? The
plan
A) is in writing.
B) includes actionable steps.
C) should only contain business goals.
D) is shared with a mentor.
c
Jim Hanson's financial situation is as follows:
Savings account$5,000
Life insurance cash value$20,000
Short-term debts$3,000
Mortgage loan$100,000
Auto loan$10,000
Tuition payments$17,000
Auto loan payments$3,000
Mortgage loan payments$9,600
Invested assets$40,000
Use assets$220,000
A) $127,000
B) $132,000
C) $172,000
D) $182,000
What is his net worth?
b
As of December 31, 20X1, Bill Simpson has the following financial data:
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2024/2025
Salaries$90,000
Investment income$4,000
Mortgage payments$16,000
Insurance$3,000
Auto notes$20,000
Income taxes$25,000
Auto payments$6,000
Medical/dental$4,000
Misc.expenses$15,000
Utilities$3,000
CD$5,000
Education$10,000
Food$8,000
What is Bill's surplus or deficit?
A)$14,000
B)$4,000
C)$1,000
D)$7,000
b
Which one of the following is the most correctly formulated goal for a client?
A) invest $500 monthly using a dollar cost averaging strategy to increase net
worth
B) accumulate $50,000 in seven years for a son's education
C) accumulate $50,000 for a second home
D) build enough net worth to retire in 15 years
d
Which one of the following is most accurate with respect to the life insurance
needs of the typical family?
A) The need for insurance to cover both final expenses and lost income decreases
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2024/2025
at age 70.
B) Life insurance generally allows families to reduce their income taxation
exposures.
C) The need for life insurance remains steady until age 65.
D) Total life insurance requirements may decrease as an individual approaches
retirement.
d
Upon retirement, the bulk of a client's assets generally should be invested in
A) derivatives and other alternative investment for above-average short-term
gains.
B) fixed-income investments for current income and safety of principal.
C) money market funds for maximum safety of principal.
D) growth investments to preserve purchasing power.
a
One of the primary purposes of an investment policy statement is to
A) provide a basis for portfolio review.
B) project market returns for the portfolio.
C) separate the role of the client and the investment professional.
D) identify the securities to be included in the portfolio.
c
An investment policy statement should be
A) developed to provide considerable investment flexibility.
B) written to reflect current market trends.
C) constructed to reflect realistic return expectations.
D) consistent with SEC investment policy guidelines.
b
In an investment policy statement, which of these attributes is necessary to
benefit from the positive bias of most investment vehicles?
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