Practice Quiz

CFP Certified Financial Planner Test Prep - Question List

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16.

Sam Serval's wife is the CFO of a leading manufacturing company. If Sam Serval is offered to provide some services related to financial planning for said company,  which fundamental principal will be impaired if Sam Serval accepts the proposal?

  1. Confidentiality
  2. Integrity
  3. Objectivity
  4. Fairness
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17.

Investors prefer to hold more investment in bonds because they:

  1. Are less volatile than stock
  2. Pay a higher return that stock
  3. Are more readily available
  4. Have low-impact interest rates
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18.

A prudent investor will always follow the principle of diversification of investments because:

  1. They seek to maximize risk
  2. They seek to minimize losses
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19.

When the return on two different investment portfolios is negatively co-related, this indicates:

  1. Both investments show a higher rate of return
  2. Both investments show a lower rate of return
  3. One investment shows a higher rate of return than the other
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20.

Which of the following is true of an unsystematic risk?

  1. It affects all investments irrespective of diversification
  2. It is unique to specific investments
  3. Non of the above
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