Question 1

Employee benefits are best defined as:

Accepted Answer

A) The satisfaction employees feel when working for a successful company. 
B) The benefits that flow to employers from hiring additional employees. 
C) Forms of employee compensation other than salary. 
D) Tax-deductible compensation employees receive for retirement purposes. 
E) None of the above. 
A) The satisfaction employees feel when working for a successful company. 
B) The benefits that flow to employers from hiring additional employees. 
C) Forms of employee compensation other than salary. 
D) Tax-deductible compensation employees receive for retirement purposes. 
E) None of the above. C

Question 2

A financial planner establishes the scope of the activity during the personal financial planning process through:

Accepted Answer

A) Determining the number of people in the household. 
B) Defining the specific financial planning services that will be provided. 
C) Determining the cash inflow to the household. 
D) Determining the number of years until the client expects to retire. 
E) None of the above. 
A) Determining the number of people in the household. 
B) Defining the specific financial planning services that will be provided. 
C) Determining the cash inflow to the household. 
D) Determining the number of years until the client expects to retire. 
E) None of the above. B

Question 3

Why do the disciplines of psychology and sociology have a role in the practice of personal financial planning?

Accepted Answer

A) They provide logical,rather than emotional,explanations for how people act. 
B) They provide behavioral,rather than logical,explanations for how people act. 
C) They explain how people should act. 
D) They help us understand how people and households allocate scarce resources. 
E) They provide therapies that can reduce the anxiety faced by clients. 
A) They provide logical,rather than emotional,explanations for how people act. 
B) They provide behavioral,rather than logical,explanations for how people act. 
C) They explain how people should act. 
D) They help us understand how people and households allocate scarce resources. 
E) They provide therapies that can reduce the anxiety faced by clients. B

Question 4

In practice,most clients ask their personal financial planner to:

Accepted Answer

A) Provide free consultation 
B) Provide assistance with a specific problem 
C) Recommend a lawyer or accountant 
D) Provide tax advice 
E) Provide a comprehensive financial plan 
A) Provide free consultation 
B) Provide assistance with a specific problem 
C) Recommend a lawyer or accountant 
D) Provide tax advice 
E) Provide a comprehensive financial plan

Question 5

Which of the following is not a step in the personal financial planning decision making process?

Accepted Answer

A) Establish the scope of the activity 
B) Identify and report tax evasion to the authorities 
C) Gather data and identify goals 
D) Compile and analyze the data 
E) All of the above are steps in the personal financial planning decision making process 
A) Establish the scope of the activity 
B) Identify and report tax evasion to the authorities 
C) Gather data and identify goals 
D) Compile and analyze the data 
E) All of the above are steps in the personal financial planning decision making process

Question 6

Capital is best defined as:

Accepted Answer

A) The places where tangible goods and financial instruments like stocks and bonds are bought and sold. 
B) The economic operation of the organization based on the cash it generates. 
C) The real,financial,and human related assets that are generated by individuals and organizations or bought and sold in the marketplace. 
D) None of the above. 
E) All of the above. 
A) The places where tangible goods and financial instruments like stocks and bonds are bought and sold. 
B) The economic operation of the organization based on the cash it generates. 
C) The real,financial,and human related assets that are generated by individuals and organizations or bought and sold in the marketplace. 
D) None of the above. 
E) All of the above.

Question 7

Which of the following is the market-established worth of a product or a financial instrument?

Accepted Answer

A) Market value 
B) Fair value 
C) Cash flow 
D) Investments 
E) Book value 
A) Market value 
B) Fair value 
C) Cash flow 
D) Investments 
E) Book value

Question 8

Personal financial planning must satisfy four broad categories of personal-finance decisions: consumption and savings,investments,financing,and risk management.Into which category does each of the following five examples belong?
-Inability to save properly.
-Need to resolve a debt problem.
-Desire to improve investment returns.
-Desire to retire comfortably on time.
-Discomfort with present risk profile.

Accepted Answer

The five examples and their correspondin

Question 9

The buying and selling of tangible goods and financial instruments is a feature of:

Accepted Answer

A) a market 
B) an investment 
C) a household 
D) a market structure 
E) none of the above 
A) a market 
B) an investment 
C) a household 
D) a market structure 
E) none of the above

Question 10

During the personal financial planning process,a financial planner will not gather data related to:

Accepted Answer

A) Household financial assets. 
B) Household income and expenditures. 
C) Age and health of members in the household. 
D) The household's tolerance of risk 
E) Data will be gathered in relation to all of the above. 
A) Household financial assets. 
B) Household income and expenditures. 
C) Age and health of members in the household. 
D) The household's tolerance of risk 
E) Data will be gathered in relation to all of the above.

Question 11

What factor explains expanded financial planning services in the 1970s?

Accepted Answer

A) A middle class with increased discretionary income. 
B) The growing complexity of financial instruments and services. 
C) Personal financial planning developing as a profession. 
D) Magazines and other media that increased awareness of personal finance issues. 
E) All of the above. 
A) A middle class with increased discretionary income. 
B) The growing complexity of financial instruments and services. 
C) Personal financial planning developing as a profession. 
D) Magazines and other media that increased awareness of personal finance issues. 
E) All of the above.

Question 12

Which of the following steps in the personal financial planning process comes last?

Accepted Answer

A) Implement. 
B) Monitor and review. 
C) Compile and analyze data. 
D) Establish scope of activity. 
E) Develop solutions and present the plan. 
A) Implement. 
B) Monitor and review. 
C) Compile and analyze data. 
D) Establish scope of activity. 
E) Develop solutions and present the plan.

Question 13

Market structure is the term used to describe:

Accepted Answer

A) The study of how people develop the cash flows necessary to support their operations and provide for their well-being. 
B) Places where tangible goods and financial instruments like stocks and bonds are bought and sold. 
C) A structure through which you can establish and integrate all of your goals and needs. 
D) The economic operations of the business,the government,and the household that facilitate the purchase and sale of items. 
E) None of the above. 
A) The study of how people develop the cash flows necessary to support their operations and provide for their well-being. 
B) Places where tangible goods and financial instruments like stocks and bonds are bought and sold. 
C) A structure through which you can establish and integrate all of your goals and needs. 
D) The economic operations of the business,the government,and the household that facilitate the purchase and sale of items. 
E) None of the above.

Question 14

Which of the following best defines household finance?

Accepted Answer

A) The study of how a household and the people in it develop the cash flows necessary to support operations and provide for the well-being of its members. 
B) The study of how much it costs to purchase a home. 
C) The study of how a household and the people in it can minimize the risk of bankruptcy. 
D) The study of how the number of people in a household can be maximized. 
E) The study of how a household and the people in it limit expenditures and maximize cash inflows. 
A) The study of how a household and the people in it develop the cash flows necessary to support operations and provide for the well-being of its members. 
B) The study of how much it costs to purchase a home. 
C) The study of how a household and the people in it can minimize the risk of bankruptcy. 
D) The study of how the number of people in a household can be maximized. 
E) The study of how a household and the people in it limit expenditures and maximize cash inflows.

Question 15

Financial planners are best characterized as:

Accepted Answer

A) People with designations,education,and experience,who are trained to practice personal financial planning. 
B) People with households that recognize that they must plan for their household's financial future. 
C) People that integrate macroeconomic theories into capital budgeting decisions using a logical,scientific approach. 
D) People that integrate psychology and sociology theories into investment decisions using a behavioral approach. 
E) None of the above characterizes financial planners. 
A) People with designations,education,and experience,who are trained to practice personal financial planning. 
B) People with households that recognize that they must plan for their household's financial future. 
C) People that integrate macroeconomic theories into capital budgeting decisions using a logical,scientific approach. 
D) People that integrate psychology and sociology theories into investment decisions using a behavioral approach. 
E) None of the above characterizes financial planners.

Question 16

Which of the following designations does not have a broad educational requirement in financial planning?

Accepted Answer

A) Chartered Financial Consultant ChF
C)  
B) Personal Financial Specialist PFS) 
C) Chartered Financial Analyst CF
A)  
D) Certified Financial Planner CFP) 
E) National Association of Personal Financial Advisors NAPF
A) Registered Financial Advisor 
A) Chartered Financial Consultant ChF
C)  
B) Personal Financial Specialist PFS) 
C) Chartered Financial Analyst CF
A)  
D) Certified Financial Planner CFP) 
E) National Association of Personal Financial Advisors NAPF
A) Registered Financial Advisor

Question 17

Similar to a medical doctor,a financial planner:

Accepted Answer

A) Is typically compensated through an insurance company. 
B) Must be familiar with the overall state of the client's financial health,regardless of the service being provided. 
C) Must specialize in one area. 
D) All of the above. 
E) None of the above. 
A) Is typically compensated through an insurance company. 
B) Must be familiar with the overall state of the client's financial health,regardless of the service being provided. 
C) Must specialize in one area. 
D) All of the above. 
E) None of the above.

Question 18

Which of the following is not an example of a service that financial planners typically provide?

Accepted Answer

A) Comprehensive financial plan construction. 
B) Elimination of debt difficulties. 
C) Retirement planning. 
D) Taxes reduction through planning,products and structures. 
E) All of the above are examples of services that financial planners typically provide. 
A) Comprehensive financial plan construction. 
B) Elimination of debt difficulties. 
C) Retirement planning. 
D) Taxes reduction through planning,products and structures. 
E) All of the above are examples of services that financial planners typically provide.

Question 19

What is the objective of financial integration?

Accepted Answer

A) To look at how actions in one part of personal financial planning can affect other areas. 
B) To use corporate financial managerial techniques in personal financial planning. 
C) To place cash flow into assets designed to provide future funds for consumption. 
D) To look at the functioning of the entire economy or a major section of it. 
E) To reduce risk in a tax efficient manner. 
A) To look at how actions in one part of personal financial planning can affect other areas. 
B) To use corporate financial managerial techniques in personal financial planning. 
C) To place cash flow into assets designed to provide future funds for consumption. 
D) To look at the functioning of the entire economy or a major section of it. 
E) To reduce risk in a tax efficient manner.

Question 20

Which of the following is not a reason why financial planning procedures must be monitored and reviewed periodically?

Accepted Answer

A) Incomes change 
B) Life situations change 
C) Individual goals change 
D) The financial environment changes 
E) All of the above are reasons why financial planning procedures must be monitored and reviewed periodically 
A) Incomes change 
B) Life situations change 
C) Individual goals change 
D) The financial environment changes 
E) All of the above are reasons why financial planning procedures must be monitored and reviewed periodically

Exam 1: Introduction to PFP

Employee benefits are best defined as:

A financial planner establishes the scope of the activity during the personal financial planning process through:

Why do the disciplines of psychology and sociology have a role in the practice of personal financial planning?

In practice,most clients ask their personal financial planner to:

Which of the following is not a step in the personal financial planning decision making process?

Capital is best defined as:

Which of the following is the market-established worth of a product or a financial instrument?

The buying and selling of tangible goods and financial instruments is a feature of:

During the personal financial planning process,a financial planner will not gather data related to:

What factor explains expanded financial planning services in the 1970s?

Which of the following steps in the personal financial planning process comes last?

Market structure is the term used to describe:

Which of the following best defines household finance?

Financial planners are best characterized as:

Which of the following designations does not have a broad educational requirement in financial planning?

Similar to a medical doctor,a financial planner:

Which of the following is not an example of a service that financial planners typically provide?

What is the objective of financial integration?

Which of the following is not a reason why financial planning procedures must be monitored and reviewed periodically?

Time Value of Money

Beginning the Planning Process

Household Finance

Financial Statements Analysis

Cash Flow Planning

Debt

Non Financial Investments

Financial Investments

Risk Management

Other Insurance

Retirement Planning

Educational Planning

Tax Planning

Estate Planning

Stocks, Bonds and Mutual Funds

Background Topics

Capital Needs Analysis

Behavioral Financial Planning

Modern Investment Theory

Employee Benefits

Behavioral Finance-Applications

Comprehensive Financial Plan-Dan and Laura

Examining Financial Regulation and Ethics

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