Question 1

Market evidence indicated that adjustable-rate preferred stocks generally required yields in the range of ______________ basic points.

Options :

A : 42 to 445

B : 48-498

C : 32-500

D : 50-500

Answer: A

Question 2

Any Buy-Sell agreement, restrictions, or other similar factor relating to the right to use or sell the property will be ignored for estate gift, and generation skipping tax purposes unless the agreement meets any of the following test EXCLUDING:

Options :

A : It is a bona fide business arrangement

B : It must be a device to transfer the property to the natural objects of the transferor-s bounty (such as family members) for less than adequate and full consideration in money or money-s worth

C : Its terms must be comparable to similar arrangements entered into by persons in an arm-s length transaction

D : It is a key player in Buy-Sell arrangements

Answer: D

Question 3

It is highly unlikely, in formula approaches for setting the price in a buy-sell agreement, that the price established by a formula at the time of signing will be even close to the value of the interest at the time of triggering event, which could be many years later. For these reason analysts:

Options :

A : Highly encourage the use of formulas in high-sell agreements

B : Highly discourage the use of formulas in high-sell agreements

C : Allow flexibility in approach

D : Do not allow flexibility in approach

Answer: B

Question 4

A major issue in many fair value cases is:

Options :

A : Whether or not discounts and/or premiums are applicable

B : Lack of control

C : Lack of marketability

D : lack of ownership control premiums under certain specific circumstances.

Answer: A

Question 5

It is possible to examine the uncertainty of income to the various suppliers of capital by investigating the uncertainty of income to the company. The greater the uncertainty of income to the company:

Options :

A : The greater the uncertainty of the income to the investor in the company

B : The lesser the uncertainty of the equity to the investor in the company

C : The greater the uncertainty of the equity to the investor in the company

D : The lesser the uncertainty of the income to the investor in the company

Answer: A

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