Segregated Funds & Annuities - Chapter 2 Exam Questions and Answers

Segregated Funds & Annuities - Chapter 2 Exam Questions and Answers 10 years. (Reference: Chapter 2) -Correct Answer-What is the minimum maturity date for a segregated fund contract? NAVPU = [total value of assets - liabilities] / [number of units outstanding]. (Reference: Chapter 2) -Correct Answer-What is the NAVPU Formula? $35,000. The client receives the greater of market value or guarantee. (Reference: Chapter 2) -Correct Answer-Jenna invests $40,000 in a 75% / 75% segregated fund. Upon maturity, the value of the fund is $35,000. How much does Jenna receive? Any time. (Reference: Chapter 2) -Correct Answer-Sarah has $10,000 invested in a segregated fund. She wants to withdraw $5,000. When can Sarah make the withdrawal? Interest, dividends, and capital gains. (Reference: Chapter 2) -Correct Answer-Which type of investment returns are generated by income funds? $25,000. (Reference: Chapter 2) -Correct Answer-Laura invests $100,000 in a segregated fund with a 75 / 75 guarantee. How much of Laura's original capital is at risk? The issue of whether or not an investor's assets are exempt from claims of their creditors in the event that the investor becomes bankrupt. (Reference: Chapter 2) -Correct Answer-What does creditor protection refer to? Guaranteed Minimum Withdrawal Benefit. (Reference: Chapter 2) -Correct Answer-What does GMWB stand for? Deferred Sales Charge. (Reference: Chapter 2) -Correct Answer-What does DSC stand for? What are the two guarantees provided by a segregated fund? -Correct Answer-A maturity guarantee and a death benefit guarantee. What is the minimum maturity date of a segregated fund? -Correct Answer-10 years, they can be more but 10 is the lowest number of years available. What does unlimited upside potential mean? -Correct Answer-There is a minimum contract value at maturity, but there is no maximum to what the value may be. When the market value at maturity is less than the guarantee value, where does the difference come from? -Correct Answer-The insurer makes up the difference between the market value and the guarantee from its financial reserves. In effect, the insurer "tops up" the market value to equal the value of the maturity guara