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NISM SERIES X-A: INVESTMENT ADVISER - (LEVEL 1

)
1. Which of the following is a financial goal?
a) Rs.6 lakhs required for sister’s c) Rs. 10 lakhs needed for
wedding purchasing a flat
b) A sizable sum needed to buy a d) Rs.5 lakhs needed after two years
new car in two years time to pay child’s tuition fees
e)
f) 2. Mr. Khanna requires Rs.10 lakhs in six months time to pay his son’s admission
fees. An appropriate investment to set aside money for his goal would be
a) Equity shares of high-growth c) Short term debt fund
companies d) Long term corporate bond
b) Real estate
e)
f) 3. Jaya needs Rs.5 lakhs urgently for an emergency medical procedure. Which
investment is she most likely to tap?
a) Shares of Hindalco Ltd d) 5-year bonds of a finance
b) Bank deposit company
c) Gold jewellery
e)
f) 4. A conservative investor wants to accumulate Rs.20 lakhs in 3 years time. What
would be an appropriate investment option for him?
a) Shares of selected growth c) Property
companies d) Gold funds
b) Bank deposits and good quality
bonds
e)
f) 5. Investment A appreciates in value by 20% after one year. Investment B
appreciates by 40% after three years. Which gives a higher return?
a) Investment B, because it has a higher absolute return
b) Investment A, because it can be exited after just one year
c) Investment B, because it has a higher holding period
d) Investment A, because it has a higher annualized return
g)
h) 6. The concept of time value of money implies that
a) Money should be invested immediately without wasting time
b) Due to inflation, money has a lower purchasing value in future
c) The timing of investment influences final returns
d) Current cash inflows can be re-invested to earn a return that increases future
value
i)
j) 7. An investor in mutual funds typically enters the fund at a certain value, and
exits at another value after a specified holding period. The appropriate measure
to assess his return is
a) Absolute return c) Holding Period Return
b) Annualized return d) IRR
e)
f) 8. An investment in 7% tax free bonds is compared with an investment in a 9%
bank deposit where interest is taxable. Both have a one year investment horizon.
Which of the following is true?
a) The bond interest is tax free so it is better
b) For an investor who is not taxable, the bank deposit offers a better return
c) For an investor with a 30% tax rate, the bank deposit gives higher post tax return
d) For an investor with a 10% tax rate, the bank deposit gives lower post-tax return
g)
h) 9. A retired person is depending on a monthly annuity income to finance his
expenses. The greatest risk faced by his cash flows is
a) Business risk c) Interest rate risk
b) Exchange rate risk d) Inflation risk
e) 10. Investment in a government security issued at a fixed interest rate is subject
to

An investor holds a large portfolio of shares from different companies and industries. The portfolio when constructed. Short term debt funds carry a) High mark to market b) Low mark-to-market c) No mark-to-market risk risk risk d) e) 17. should have a higher allocation to a) Debt b) Cash equivalents c) Equity d) e) 20. Which of the following products is a pure insurance product? f) ULIP a) Money back policy b) Term insurance c) Whole life policy policy d) e) 22.a) Credit risk c) Interest rate risk b) Business risk d) Liquidity risk e) f) 11. In which of the following situations will the insured not have insurance cover? a) Surrendered policy c) Term policy b) Paid-up policy d) Both (a) and (b) e) 23. Which of these asset classes is most likely to meet the objective of generating regular income? a) Equity b) Cash and c) Debt equivalents d) e) 18. Which of these asset classes is primarily used to meet regular needs for liquid cash? a) Debt b) Cash and c) Equity equivalents d) e) 19. An investor who seeks a high level of return and is willing to bear the risks of such investments is likely to be recommended a) Aggressive b) Conservative c) Moderate portfolio portfolio portfolio d) e) 21. The long term goal of an investor is to build a corpus that is adequate to serve his income needs after retirement. Her portfolio is likely to be protected from a) Credit risk c) Liquidity risk b) Inflation risk d) Unsystematic risk e) f) 13. The returns from his investment do not face a) Interest rate risk c) Business risk b) Credit risk d) Inflation risk e) f) 12. The premium payable on a ULIP is higher for the same sum assured as a term policy because . FMPs achieve lower mark-to-market risk by investing in a) shorter term securities that mature before the tenor of the fund b) floating rate securities with reset tenor less than six months c) securities whose maturity matches that of the fund f) g) 16. Interest on a NSC a) Is paid out annually c) Is accumulated and paid at the b) Is compounded and paid out end of the term quarterly d) e) 14. An investor purchases equity shares of a cement manufacturing company. Which of the following instruments under Section 80C enjoys an EEE status? a) ELSS b) PPF c) SCSS d) e) 15.

a) 100% b) 50% c) 40% d) 60% e) f) 32.000. a) 1 lac b) 25 lacs c) 5 lacs d) 10 lacs e) f) 35. Growth-oriented investments are suitable for which stage of retirement savings? a) Accumulation stage c) Income stage b) Distribution stage d) Investment stage e) f) 26. Long term capital gain from sale of shares is ____________________. The minimum tangible assets to be maintained by an individual investment adviser are Rs. Which of the following is a solution to manage inadequacy of retirement corpus closer to retirement? a) Invest in riskier assets c) Reduce periodic savings b) Postpone retirement d) Increase corpus target e) f) 29. Commission received from business forms part of income from ___________. a) Taxed at 10% c) Taxed at 20% b) Exempt from tax d) Taxed at 15% with indexation e) f) 31.f) The period of cover is shorter a) A portion of the premium is used for investment b) The pool of insured is smaller c) The risk is higher d) e) 24. he must have stayed outside India for a minimum period of _____ days in a previous financial year. a) AMFI b) SEBI c) PFRDA d) SRO e) . Inflation does which of the following to retirement planning? a) Reduces the periodic savings c) Increases the retirement corpus required required b) Reduces the return generated by d) Increases the value of the corpus an investment created e) f) 27. The term of insurance in non-life insurance is typically a) Decided by the insured c) One year b) Decided based on sum insured d) Flexible e) f) 25. 2013: a) Fund Manager of an AMC b) A distributor of a mutual fund who only receives commission from the AMC. c) An IFA who charges advisory fees to investors d) A Chartered Accountant practicing his profession g) h) 34. a) Business and profession c) Salary b) Capital Gains d) Other sources e) f) 30. Which of the following persons is expected to comply with registration requirement under SEBI (Investment Advisers) Regulations. a) 365 b) 280 c) 182 d) 150 e) f) 33. 2012 allows exemption up to _______ for investments made in eligible securities up to Rs. The Rajiv Gandhi Equity Savings Scheme. 50. Registration and regulation of securities market intermediaries is the function of _____. The retirement corpus may require review a) Every year c) Closer to the distribution period b) Every time there is a significant d) Not at all change in financial situation e) f) 28. For a person to be qualified as a NRI. _______.

f) 36. A person who has a complaint against an insurance company must lodge his complaint with___. a) SCORES b) IGMS d) RBI b) c) CGMS a) .