Online Access Free CIFC Practice Test

Your client, Rinaldo, wants to know more about the fees associated with his mutual funds. What can you tell him about a mutual fund's management expense ratio (MER)?

• A.Mutual funds are required to calculate the MER on a daily basis.
• B.Mutual fund performance is not impacted by the MER since rates of return are published net of fees.
• C.The MER reflects the percentage of each dollar of fund assets that is used to pay for management services.
• D.Trailer and brokerage fees are charged separately from the MER.

Every February, Reginald, a Dealing Representative, feels pressured by his Manager to generate new registered retirement savings plans (RRSP) and contributions to assist the branch in meeting broader business targets. Reginald is nearing the end of February, and he has a meeting with a new client, Orel. Orel wants to open a tax-free savings account (TFSA) to develop emergency savings because he does not want to worry about his withdrawals being taxed. Reginald suggests that if Orel were to contribute to an RRSP first, then the resulting tax savings could be used to fund a new emergency account.
In relation to account suitability, what can be said about Reginald's advice?

• A.Reginald is putting the client's interest first by informing Orel why he should change his purpose for investing.
• B.Recommending an investment solution that addresses two needs is putting Reginald's client's interest first
• C.Based on Orel's stated need, recommending an RRSP contribution is unsuitable.
• D.By convincing Orel to contribute an RRSP, instead of a TFSA, Reginald has put his client's interest first.

Terri, 30 years old, is the marketing manager at Provincial Winery with an average annual income of $60,000.
Her spouse Yvette, 28 years old, is a project manager with a telecommunications firm earning
$70,000 per year. You are helping them to organize their investments and are trying to assess their financial resources.
Which of the following is the best question to ask?

• A.Do you have pension plans at work?
• B.What is your investment experience?
• C.Do you have any children?
• D.When do you need the money?

One of your clients, Fernando, is approaching 71 years of age and has a few questions regarding life income funds (LIFs).
Which of the following statements about LIFs is TRUE?

• A.Fernando can transfer money from his registered retirement savings plan (RRSP) to a LIF.
• B.Fernando can transfer money from his locked-in retirement account (LIRA) to a LIF.
• C.Fernando is free to withdraw any amount from his LIF above the minimum amount.
• D.Fernando may make contributions to his LIF if he continues working.

Douglas, aged 73, won a lottery prize of $100,000 last week. Today he contacted Vincent, his Dealing Representative, with instructions to contribute the winnings to his registered retirement income fund (RRIF) account.
Which of the following statement about RRIF is CORRECT?

• A.Deposits into RRIFs are not permitted.
• B.Withdrawals from a non-qualifying RRIF are not taxable.
• C.Deposits to a RRIF entitle Douglas to a tax deduction.
• D.Deposits to RRIFs cannot be withdrawn for 5 years.