Exam (elaborations)
CFP PRACTICE QUESTIONS & ANSWERS
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CFP PRACTICE QUESTIONS & ANSWERS
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CFP PRACTICE QUESTIONS & ANSWERSStafford Loans are administered by:
A) Private Loan Administration
B) Federal Family Education Loan Program
C) Parent loans to undergraduate students
D) Federal assistance loan program - Answers -B
Perkins loans - Answers -Low-interest federal student loans for undergraduate and
graduate students distributed on the basis financial need.
Are Parent Loans to Undergraduate Students (PLUS) available to both full and part time
students? - Answers -No, only available to full time students
Perfect elasticity results in a ______ demand curve, perfect inelasticity results in a
_____ demand curve
A) vertical, horizontal
B) horizontal, vertical
C) Diagonal, horizontal
D) Vertical, diagonal - Answers -B, Horizontal, vertical
Money in a coverdell savings account must be used by the time beneficiary is
____years of age - Answers -30
A Change in quantity supplied is identified bu which of the following?
A) Shifting the demand curve
B) Shifting the supply Curve
C) Movement along the supply curve
D) Movement along the demand curve - Answers -C- This is the willingness to offer the
same product at different prices.
What is the result if money distributed from a 529 plan is not used to pay for qualifying
education expenses?
(How are the gains taxed, and what is the penalty percentage?) - Answers -Taxed as
ordinary income, 10% penalty applied
Which of the following are qualified expenses to be paid from a coverdell ESA
1) Computers and laptops
2) Transportation
3) Books
4) Tuition, room & board - Answers -2,3,4
Which of the following is/are correct regarding the regulation of insurance companies
and broker-dealers?
1) Insurance company regulation occurs primarily at the state level
2) Broker-dealer regulation occurs primarily at the state level
, A) 1 only
B) 2 only
C) None
D) All - Answers -A
All but which of the following are correct regarding torts?
A) A Tort can be either civil or criminal in nature
B) The most common type of unintentional tort is negligence
C) A tort is a civil wrong
D) The most common type of intentional tort is assault and battery - Answers -A- Tort is
civil
An agent is responsible to his or her ____ not the____
A) Principal, company
B) principal, client
C) company, principal
D) Client, principal - Answers -B
According to the concept of adverse selection, individuals who are ____ likely to need
insurance benefits are the ones ____ likely to purchase coverage
A) least, most
B) most, least
C) least, least
D) most, most - Answers -D
According to the principal of ____ an insured will only be reimbursed for the amount of
his or her actual loss, and cannot make a profit from the loss
A) adhesion
B) waiver and estoppel
C) Indemnity
D) Rescission - Answers -C
Which of the following cannot be insured?
A) Commercial Real estate
B) Private Residence
C) Raw Land
D) All of the above can be insured - Answers -C
All but which of the following are correct regarding umbrella insurance policies?
A) Policies often have 1 million minimum amount of coverage
B) Umbrella insurance is referred to as "excess liability coverage"
C) Umbrella insurance picks up where underlying coverages, such as life and
disabilities insurance leave off
D) Policies can be purchased in increments of 1 million - Answers -C
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