Free AAFM CWM_LEVEL_2 Study Guides Exam Questions & Answer
CWM_LEVEL_2 Exam Dumps, CWM_LEVEL_2 Practice Test Questions
NEW QUESTION 526
Section C (4 Mark)
As a CWM you are required to calculate the tax liability of an individual whose Taxable income is:
* $125000 in US dollars and he is a US citizen (single individual)
* $109000 in SGD and he is a citizen of Singapore
- A. 28460.50 USD and 15680 SGD
- B. 26480 USD and 15870 SGD
- C. 24580.50 USD and 16100 SGD
- D. 27450.10 USD and 14780 SGD
Answer: A
NEW QUESTION 527
Section A (1 Mark)
The cumulative number of futures contracts that are not offset at any point in time is called:
- A. Open interest.
- B. MARKED to the market position.
- C. Hedged position.
- D. Margin
Answer: A
NEW QUESTION 528
Section C (4 Mark)
An investor Mr. Dayal, executes a Long Strangle by buying a Rs. 4300 Nifty Put for a premium of Rs. 23 and a Rs 4700Nifty Call for Rs 43. The Nifty is at 4500 The Net Payoff of Long Strangle
* If Nifty closes at 4100
* If Nifty closes at 5300
- A. 134 and 534
- B. 234 and 334
- C. -66 and 34
- D. 234 and 0
Answer: A
NEW QUESTION 529
Section A (1 Mark)
Current ratio is
- A. None of the above
- B. Current Assets / Current liabilities
- C. Current Cash / Current liabilities
- D. Current Liabilities / Current assets
Answer: B
NEW QUESTION 530
Section A (1 Mark)
Which of the following is true regarding credit card loans?
- A. There is evidence that considerable economies of scale exist
- B. Credit cards are very inflexible for consumers
- C. All of the above are true
- D. Credit cards cannot act as installment loans
Answer: A
NEW QUESTION 531
Section B (2 Mark)
An investment opportunity having a market price of Rs. 100,000 is available. You could obtain a Rs. 75,000,
25-year mortgage loan requiring equal monthly payments with interest at 9.5 percent. The following operating results are expected during the first year.
What is the Overall capitalization rate?
- A. 25%
- B. 33%
- C. 16%
- D. 12%
Answer: D
NEW QUESTION 532
Section A (1 Mark)
Company J and Company K each recently reported the same earnings per share (EPS). Company J's stock, however, trades at a higher price. Which of the following statements is most correct?
- A. Company J must have a higher market to book ratio.
- B. Company J must have fewer growth opportunities.
- C. Company J must be riskier.
- D. Company J must have a higher P/E ratio.
Answer: D
NEW QUESTION 533
Section A (1 Mark)
Which of the following are the advantages of a Credit Union:
- A. II, IV and V
- B. I, III and V
- C. All of the Above
- D. I, III and IV
Answer: C
NEW QUESTION 534
Section A (1 Mark)
An Agreement between the tenant and the landlord for the right to use the property for a specified period of time is known as ____________.
- A. Lease / Tenancy Agreement
- B. Agreement for Sale
- C. Development Agreement
- D. Indemnity Bond
Answer: A
NEW QUESTION 535
Section A (1 Mark)
Mr. Rajesh was the owner of an uninsured property. But unfortunately the property caught fire because of which he suffered severe financial losses. The reason Mr. Rajesh suffered losses as he did not cover:
- A. The investment risk
- B. The dynamic risk
- C. The speculative risk
- D. The pure risk
Answer: D
NEW QUESTION 536
Section A (1 Mark)
Book building is used to help in better
- A. Retail participation
- B. Price discovery
- C. Institutional participation
- D. Investor communication
Answer: B
NEW QUESTION 537
Section A (1 Mark)
If your credit application is denied, you:
- A. Are entitled to know the specific reason you were denied credit.
- B. Should sue the credit rating agency.
- C. Should file a complaint against the merchant.
- D. Have no legal right to know why.
Answer: A
NEW QUESTION 538
Section A (1 Mark)
The goal of the Dow theory is to
- A. Identify resistance levels.
- B. Identify long-term trends
- C. Identify support levels
- D. Identify breakaway points
Answer: B
NEW QUESTION 539
Section C (4 Mark)
National City Corporation, a bank holding company, reported earnings per share of Rs2.40 in 1993, and paid dividends per share of Rs1.06. The earnings had grown 7.5% a year over the prior five years, and were expected to grow 6% a year in the long term (starting in 1994). The stock had a beta of 1.05 and traded for ten times earnings. The treasury bond rate was 7%.
Estimate the P/E Ratio for National City Corporation and the long term growth rate that is implied in the firm's current P/E ratio.
- A. 8.05 and 10.54%
- B. 6.91 and 8%
- C. 7.65 and 8.50%
- D. 6.50 and 9.25%
Answer: B
NEW QUESTION 540
Section B (2 Mark)
The ____________ provides an unequivocal statement on the expected return-beta relationship for all assets, whereas the _____________ implies that this relationship holds for all but perhaps a small number of securities.
- A. CAPM, APT
- B. APT, OPM
- C. CAPM, OPM
- D. APT, CAPM
Answer: A
NEW QUESTION 541
Section B (2 Mark)
If after the partition of an HUF 2 members became partners in 3 firms on behalf of their respective HUFs and they also become partners in a fourth firm. The funds were obtained by means of loans from the other 3 firms.
The share incomes of the members from the fourth firm were assessable as their individual income only.
- A. TRUE
- B. FALSE
Answer: A
NEW QUESTION 542
Section C (4 Mark)
Read the senario and answer to the question.
Calculate the tax liability of Mr. Neeraj for the A.Y.08-09 assuming that he has avail full deduction under section 80C
- A. Rs. 509500
- B. Rs. 485000
- C. Rs. 496910
- D. Rs. 525000
Answer: C
NEW QUESTION 543
Section B (2 Mark)
Which of the following are the ways to avoid escalation of commitment are listed below?
- A. I and II
- B. II and III
- C. I and III
- D. All of the Above
Answer: D
NEW QUESTION 544
Section A (1 Mark)
__________ is the most important investment decision because it determines the risk-return characteristics of the portfolio.
- A. Hedging
- B. Performance measurement
- C. Market timing
- D. Asset allocation
Answer: D
NEW QUESTION 545
Section B (2 Mark)
If JVM Industries pays dividend of Rs.6 per share which is growing at a 8 percent rate per year and is expected to grow at the same rate in future. Its required rate of return is 16%. Determine its share price.
- A. Rs. 79.50
- B. Rs. 65.25
- C. Rs. 81.00
- D. Rs. 55.75
Answer: C
NEW QUESTION 546
Section C (4 Mark)
Read the senario and answer to the question.
Neeraj's portfolio consist shares of company X Ltd. which is paying a dividend of Rs. 2 per share. The dividend is expected to grow @15% annual rate for 3 years, then @10% for the next 3 years, after which it is expected to grow @5% forever. What among the following would be your advice to Neeraj in case the market value of the share is Rs. 85? Assume capitalization rate to be 9% per annum
- A. Keep the share as the market price is higher than the current value of the share.
- B. Sell the share as the market price is lower than the current value of the share
- C. Sell the shares as the market price is higher than the current value of the shares
- D. Buy more shares as market price is lower than current value
Answer: C
NEW QUESTION 547
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