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WMCP PRACTICE QUESTIONS WITH ACTUAL SOLUTIONS.
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WMCP PRACTICE QUESTIONS WITH ACTUAL SOLUTIONS.
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WMCP PRACTICE QUESTIONS WITHACTUAL SOLUTIONS !!
Which vvone vvof vvthe vvfollowing vvstatements vvcorrectly vvdescribes vvmarginal vvutility?
A. vvAn vvincremental vvamount vvof vvmoney vvreceived vvfor vvperforming vvan vvadditional
vvamount vvof vvwork
B. vvThe vvsatisfaction vvreceived vvfrom vvan vvadditional vvunit vvof vvconsumption
C. vvThe vvtotal vvamount vvof vvsatisfaction vvreceived vvfrom vvspending vvannual vvincome
vv- vvAnswerB. vvThe vvsatisfaction vvreceived vvfrom vvan vvadditional vvunit vvof
vvconsumption
What vvpooling vvtechnique vvcan vvreduce vvthe vvrisk vvof vvdying vvearly vvin vvthe vvlife
vvcycle vvand vvnot vvmeeting vva vvbequest vvgoal?
A.
Annuities
B.
Bond vvladders
C.
Life vvinsurance vv- vvAnswerC.
Life vvinsurance
News vvof vvan vvunexpected vvinheritance vvwill vvmost vvlikely vvresult vvin vvwhich vvof vvthe
vvfollowing?
A.
An vvincrease vvin vvpermanent vvincome vvand vva vvreduction vvin vvthe vvsavings vvneeded
vvbefore vvretirement
B.
An vvincrease vvin vvpermanent vvincome vvwith vvno vvchange vvto vvthe vvamount vvof
vvsavings vvneeded vvbefore vvretirement
C.
A vvreduction vvin vvpermanent vvincome vvand vvan vvincrease vvin vvthe vvsavings vvneeded
vvbefore vvretirement vv- vvAnswerA.
An vvincrease vvin vvpermanent vvincome vvand vva vvreduction vvin vvthe vvsavings vvneeded
vvbefore vvretirement
A vvtypical vvutility vvcurve vvis
A.
convex vvbased vvon vva vvdecreasing vvmarginal vvutility vvof vvconsumption.
B.
concave vvbased vvon vva vvdecreasing vvmarginal vvutility vvof vvconsumption.
C.
,concave vvbased vvon vvan vvincreasing vvmarginal vvutility vvof vvconsumption. vv-
vvAnswerB.
concave vvbased vvon vva vvdecreasing vvmarginal vvutility vvof vvconsumption.
Which vvof vvthe vvfollowing vvis vva vvmarket vvrisk vvto vvthe vvvalue vvof vvhuman vvcapital?
A.
Working vvin vvan vvoccupation vvwhose vvprofits vvare vvclosely vvtied vvto vvinterest vvrates
B.
An vvinjury vvthat vvdiminishes vvthe vvvalue vvof vva vvperson's vvmarket vvproductivity
C.
A vvpremature vvdeath vveliminating vvfuture vvincome vv- vvAnswerA.
Working vvin vvan vvoccupation vvwhose vvprofits vvare vvclosely vvtied vvto vvinterest vvrates
The vvprimary vvpurpose vvof vva vvcontingent vvclaim vvis vvto
A.
increase vvexpected vvlifetime vvwealth.
B.
provide vva vvhigher vvreturn vvthan vvwhat vvis vvavailable vvfrom vvsafe vvinvestment
vvassets.
C.
protect vvtotal vvwealth vvagainst vva vvrandom vvloss. vv- vvAnswerC.
protect vvtotal vvwealth vvagainst vva vvrandom vvloss.
A vvyear vvof vvtuition vvcosts vv$10,000 vvtoday. vvWe vvsave vv$10,000 vvtoday vvto vvfund
vvtuition vvin vv5 vvyears. vvAfter vv5 vvyears, vvour vvinvestment vvhas vvgrown vvto vv$15,000.
vvA vvyear vvof vvtuition vvnow vvcosts vv$17,000. vvWhich vvof vvthe vvfollowing vvhas
vvoccurred?
A.
The vvtuition vvinvestment vvhas vvexperienced vva vvnegative vvreal vvreturn.
B.
The vvtuition vvinvestment vvhas vvexperienced vva vvnegative vvreturn.
C.
The vvtuition vvinvestment vvhas vvexperienced vva vvpositive vvreal vvreturn. vv- vvAnswerA.
The vvtuition vvinvestment vvhas vvexperienced vva vvnegative vvreal vvreturn.
When vva vvclient vvhas vvless vvflexibility vvto vvadjust vvspending, vvthe vvclient's vvportfolio
vvshould vvbe
A.
more vvin vvrisky vvassets vvand vvless vvin vvsafe vvassets.
B.
less vvin vvrisky vvassets vvand vvmore vvin vvsafe vvassets.
C.
only vvin vvrisky vvassets. vv- vvAnswerB.
less vvin vvrisky vvassets vvand vvmore vvin vvsafe vvassets.
An vvinvestor's vvpreference vvfor vvcertainty vvimplies vvthat
, A.
the vvinvestor vvneeds vva vvreward vvfor vvtaking vvrisk.
B.
the vvinvestor vvwill vvnot vvinvest vvin vvrisky vvassets.
C.
the vvinvestor vvis vvintolerant vvof vvany vvmarket vvrisk. vv- vvAnswerA.
the vvinvestor vvneeds vva vvreward vvfor vvtaking vvrisk.
How vvmuch vvwould vva vvclient vvpay vvfor vva vvrisky vvinvestment vvwith vva vv50 vvpercent
vvprobability vvof vvit vvbeing vvworth vv$3,000 vvand vv50 vvpercent vvprobability vvof vvit
vvbeing vvworth vv$8,000 vvin vvone vvyear vvassuming vva vvnatural vvlog vvutility vvfunction?
A.
$4,898.98
B.
$5,500.00
C.
$5,588.23 vv- vvAnswerA.
$4,898.98
A vvrisk-tolerant vvinvestor
A.
prefers vvmore vvinvestment vvcertainty vvthan vva vvrisk-averse vvinvestor.
B.
will vvalways vvchoose vvthe vvriskiest vvfinancial vvasset.
C.
is vvwilling vvto vvconsider vva vvmore vvuncertain vvinvestment vvpayout, vvall vvother vvthings
vvbeing vvequal. vv- vvAnswerC.
is vvwilling vvto vvconsider vva vvmore vvuncertain vvinvestment vvpayout, vvall vvother vvthings
vvbeing vvequal.
The vvthree vvelements vvof vva vvfinancial vvgoal vvare
A.
goal vvamount, vvtime vvhorizon, vvand vvinvestment vvrisk.
B.
goal vvamount, vvtime vvhorizon, vvand vvgoal vvflexibility.
C.
goal vvamount, vvinvestment vvrisk, vvand vvinvestment vvvehicle. vv- vvAnswerB.
goal vvamount, vvtime vvhorizon, vvand vvgoal vvflexibility.
Life-cycle vvplanning vvis vvbest vvdescribed vvas vvproviding
A.
a vvmethod vvto vvcalculate vvhuman vvcapital vvover vva vvperson's vvlife vvexpectancy.
B.
a vvprocess vvfor vvintegrating vvlife vvinsurance vvand vvinvestment vvtheory.
C.
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