Question 1

When purchasing a mutual fund, what is the correct way to determine the number of units purchased if theorder was entered today at 2:30 p.m. ET?

Options :

A : Use today's NAV

B : Use the 2:30 p.m. ET NAV

C : Use the average of today's and yesterday's NAV

D : Use yesterday's NAV

Answer: A

Question 2

You are concerned about upcoming weakness in the Canadian dollar. Which type of fund should you invest in?

Options :

A : A specialty fund that uses derivatives to hedge the value of its portfolio

B : An international fund that hedges its foreign currency risk

C : A global fund that hedges its foreign currency risk

D : A global fund that does not hedge its foreign currency risk

Answer: D

Question 3

Frederic recently sold his units in a US dollar (USD) denominated mutual fund. He wants to convert theproceeds back to Canadian dollars (CAD). If he received proceeds of $1,200 USD from the sale and theexchange rate is $1 CAD for $0.99 USD, how much will Frederic receive in Canadian dollars?

Options :

A : $1-188.00

B : $1,200.00

C : $1, 12.12

D : $1,320.00

Answer: C

Question 4

Cristina wants to add a mutual fund to her portfolio offering dividend income. She is considering either apreferred dividend fund or a standard equity fund. What is an important difference for Cristina to considerwhen comparing these two types of funds?

Options :

A : The standard equity fund would track an index and have less volatility.

B : A preferred dividend fund takes a more passive approach to investing.

C : The standard equity funds are willing to put capital at substantially greater risk.

D : A preferred dividend fund would offer more opportunity for capital gains and appreciation.

Answer: C

Question 5

During the calendar year, Firmansyah received a $1,800 eligible dividend from a large Canadian bank and aforeign, dividend from his The USD/CAD exchange rates is 1.3605.Firmansyah’s federal marginal tax bracket is 29%. The enhanced dividend gross-up rate is 38% and thefederal dividend tax credit rate for eligible dividends is 15%.What federal tax liability will be due from the investment income?

Options :

A : $522.00

B : $348.00

C : $695.76

D : $870.00

Answer: C

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