FINANCIAL PLANNING
(1) Which among the following would you recommend in order to seek protection
against unforeseen events?
I. Insurance
II. Transaction products like bank FD’s
III. Shares
IV. Debentures
Answer: I. Insurance
(2) When is the best time to start financial planning?
I. Post retirement
II. As soon as one gets his first salary
III. After marriage
IV. Only after one gets rich
Answer: II. As soon as one gets his first salary
(3) Which among the following is not an objective of tax planning?
I. Maximum tax benefit
II. Reduced tax burden as a result of prudent investments
III. Tax evasion
IV. Full advantage of tax breaks
Answer: III. Tax evasion
(4) An individual with an aggressive risk profile is likely to follow wealth _______
investment style.
I. Consolidation
II. Gifting
III. Accumulation
IV. Spending
Answer: III. Accumulation
(5) Which among the following is a wealth accumulation product?
I. Bank Loans
II. Shares
III. Term Insurance Policy
IV. Savings Bank Account
Answer: II. Shares
(6) Savings can be considered as a composite of two decisions. Choose them from
the list below.
I. Risk retention and reduced consumption
II. Gifting and accumulation
III. Spending and accumulation
IV. Postponement of consumption and parting with liquidity
Answer: IV. Postponement of consumption and parting with liquidity
(7) During which stage of life will an individual appreciate past savings the most?
I. Post retirement
II. Earner
III. Learner
IV. Just married
Answer: I. Post retirement
(8) What is the relation between investment horizon and returns?
I. Both are not related at all
II. Greater the investment horizon the larger the returns
III. Greater the investment horizon the smaller the returns
IV. Greater the investment horizon more tax on the returns
Answer: II. Greater the investment horizon the larger the returns
(9) Which among the following can be categorised under transactional products?
I. Bank deposits
II. Life insurance
III. Shares
IV. Bonds
Answer: I. Bank deposits
(10) Which among the following can be categorized under contingency products?
I. Bank deposits
II. Life insurance
III. Shares
IV. Bonds
Answer: II. Life insurance
(11) Which of the below can be categorized under wealth accumulation products?
I. Bank deposits
II. Life insurance
III. General insurance
IV. Shares
Answer: IV. Shares
(12) __________ is a rise in the general level of prices of goods and services in an
economy over a period of time.
I. Deflation
II. Inflation
III. Stagflation
IV. Hyperinflation
Answer: II. Inflation
(13) Which of the below is not a strategy to maximize discretionary income?
I. Debt restructuring
II. Loan transfer
III. Investment restructuring
IV. Insurance purchase
Answer : IV. Insurance purchase
