Get New 2022 Valid Practice AAFM Certification CWM_LEVEL_2 Q&A - Testing Engine
CWM_LEVEL_2 Dumps PDF - 100% Passing Guarantee
NEW QUESTION 733
Section C (4 Mark)
Mr. Dinesh constructs a BULL Call Spread Strategy with one Nifty Call Option having a Strike price of Rs.
4100 available at a premium of Rs. 170.45 and another Nifty Call option with a strike price Rs. 4400 at a premium of Rs. 35.40.
The Net Payoff of BULL Call Spread Strategy
* If Nifty closes at 4300
* If Nifty closes at 3700
- A. -115.05 and 84.95
- B. -65.05 and 0
- C. 72.05 and -125.05
- D. 64.95 and -135.05
Answer: D
NEW QUESTION 734
Section B (2 Mark)
The risk-free return is 9 percent and the expected return on a market portfolio is 12 percent. If the required return on a stock is 14 percent, what is its beta?
- A. 1.67
- B. 1.39
- C. 2.97
- D. 2.34
Answer: A
NEW QUESTION 735
Section C (4 Mark)
Read the senario and answer to the question.
Nimita purchased 500 shares of ABC Ltd., a listed company at Rs. 45 per share on Sep. 15,2002. The company offered to buy back its shares on June 15, 2009 which Nimita accepted at a price of Rs. 75 per share on Jul 1, 2009. What is the tax liability in the hands of Nimita for this transaction for Assessment Year
2010-11? Cost inflation indices are 2002-03: 447 and 2009-10 632. (Ignore Education Cess)
- A. Nil
- B. Rs. 1,500
- C. Rs. 1,140
- D. Rs. 3,000
Answer: C
NEW QUESTION 736
Section A (1 Mark)
The January effect concerns:
- A. Mid-Cap Stocks.
- B. Small Cap Stocks.
- C. Foreign Stocks.
- D. Large Cap Stocks.
Answer: B
NEW QUESTION 737
Section A (1 Mark)
Which of the following is/are the challenges of Private Banking?
- A. I, II and IV
- B. All of Them
- C. I,III and IV
- D. I, II and III
Answer: B
NEW QUESTION 738
Section B (2 Mark)
An Indian citizen leaving India during the previous year for employment purpose is said to be resident If:
- A. He is not considered as a resident
- B. He is in India in the previous year for a period of 182 days or more
- C. He has a house in India
- D. He is in India for a period of 60 days or more during the previous year and for 365 or more days during
4 previous years immediately preceding the relevant previous year
Answer: B
NEW QUESTION 739
Section A (1 Mark)
After originally investing Rs10,000 and selling your investment for Rs 12,000, you reinvest the total amount and tell yourself that you will not be concerned if you lose Rs 2,000 in this new investment. You are likely demonstrating which type of judgment error?
- A. Sunk cost fallacy
- B. House money
- C. Regret aversion
- D. Mental accounting
Answer: B
NEW QUESTION 740
Section B (2 Mark)
From the following data in respect to the property price, calculate the value of the property for your client Mr.
Nitin Sharma, as per the capitalization rate.
- A. Rs. 7,07,500
- B. Rs. 7,70,000
- C. Rs. 7,50,000
- D. Rs. 7,04,545
Answer: C
NEW QUESTION 741
Section A (1 Mark)
Holistic advisory services which cater to specific client segments such as entrepreneurs, professionals are known as_______________.
- A. Universal Banks
- B. Wealth management Specialists
- C. Family Office
- D. Global Investment Banks
Answer: C
NEW QUESTION 742
Section A (1 Mark)
______________is a risk whenever a decision maker commits resources to a course of action (thereby making an "investment") in the hope of achieving a positive outcome and experiences disappointing results
- A. Hindsight bias
- B. Mental accounting
- C. Framing Bias
- D. Escalation of Commitment
Answer: D
NEW QUESTION 743
Section B (2 Mark)
Suppose the price of a share of CAS stock is Rs500. An April call option on CAS stock has a premium of Rs5 and an exercise price of Rs500. Ignoring commissions, the holder of the call option will earn a profit if the price of the share
- A. Increases to Rs. 506.
- B. Decreases to Rs496.
- C. Increases to Rs504.
- D. Decreases to Rs490.
Answer: A
NEW QUESTION 744
Section C (4 Mark)
Phoenix Ltd has Rs 50,00,000 in total assets. The company's assets are financed with Rs 10,00,000 of debt, and Rs 40,00,000 million of common equity. The company's income statement is summarized below:
The company wants to increase its assets by Rs 10, 00,000, and it plans to finance this increase by issuing Rs
10, 00,000 in new debt. This action will double the company's interest expense, but its operating income will remain at 20 percent of its total assets, and its average tax rate will remain at 40 percent. If the company takes this action, which of the following will occur:
- A. The company's net income will increase.
- B. A and B will occur
- C. The company's return on assets will fall.
- D. The company's return on equity will remain the same.
Answer: B
NEW QUESTION 745
Section A (1 Mark)
The effect on a bond portfolio's value of a decrease in yield would be most accurately estimated by using:
- A. None of the Above
- B. The price value of a basis point.
- C. Both the portfolio's duration and convexity.
- D. The full valuation approach.
Answer: D
NEW QUESTION 746
Section A (1 Mark)
All of the following are examples of excise taxes except:
- A. Alcohol Taxes
- B. Gasoline Taxes
- C. Cigarette Taxes
- D. Property Taxes
Answer: C
NEW QUESTION 747
Section A (1 Mark)
________ bias means that investors are too slow in updating their beliefs in response to evidence.
- A. Framing
- B. Regret avoidance
- C. Overconfidence
- D. Conservatism
Answer: D
NEW QUESTION 748
Section C (4 Mark)
At end of this year ICICI Ltd. will pay a dividend on its stock of Rs. 5 per share. The dividend is expected to remain same for next year. During third year dividend is expected to be Rs.6 from there on, the dividend is expected to grow at 5% per year indefinitely. Stocks with similar risk are currently priced to provide a 10% expected return. What is the intrinsic value of ICICI Ltd.
- A. Rs. 107.84
- B. Rs. 109.84
- C. Rs. 105.50
- D. Rs.102.84
Answer: A
NEW QUESTION 749
Section A (1 Mark)
A bank is considering making a loan to Sandeep Hunjan. Sandeep owns his own home and has lived there for the past four years. What aspect of evaluating a consumer loan application is this fact most concerned with?
- A. Character and purpose
- B. Pyramiding of debt
- C. Employment and residential stability
- D. Deposit balance
Answer: C
Explanation:
Section C (4 Mark)
Mr. Vinay, aged 36 years is working in a company, at a managerial level, and has an income of Rs. 40,000 p.m. comprising of Basic salary and DA as on 31/03/2008. His other allowances amount to Rs. 18,000 p.m. He would retire at the age of 60 years. His wife Reena, aged 32 years, is working in a High School and has a post-tax income of Rs. 2,76,000 per annum. Mr. and Mrs. Vinay have two daughter Deepika, aged 10 years
and Rekha, aged 5 years.
Mr. Vinay's father died of heart attack, 5 months back, at the age of 72 years, leaving a house (Value as on date Rs. 30 lakh) in which Vinay is staying at present and other assets worth Rs. 20 lakh (shares of large cap companies worth Rs. 10 lakh, Fixed deposit in post office of Rs. 5 lakh and Bank FD of Rs. 5 lakh) in Vinay's mother's name. His mother 63 years old is disabled and fully dependent on Vinay, he being the only child of his parents. Vinay has to keep an attendant for his mother, round the clock.
The Assets of the Couple are:
1.Cash in HandRs. 18,000
2.Bank balanceRs. 40,000 (Vinay) Rs. 25,000 (Reena)
3.JewelleryRs. 400000 (Reena)
4.Money Market Mutual FundRs. 3,00,000 (Vinay)
5.Shares
?ICICI Bank 200 shares bought at Rs. 1000 per share,
?Infosys 150 shares bought at Rs. 1700 per share
?Reliance Communication 350 shares bought at Rs. 350 share.
6.Debt oriented mutual FundsRs. 2,00,000
7.PPFRs. 5,00,000 (Vinay), Rs. 4,00,000 (Reena)
8.House in the joint name of Vinay and Reena with 50% ownership of each. This house has two floors and is let out for Rs. 9,000 pm for each of the floors. Present value of this house is Rs. 60,00,000.
Vinay and Reena had taken a housing loan of Rs. 15,00,000 each. Of this Rs. 10,00,000 is pending on each name. They are presently paying an EMI of Rs. 20,000 each, Rate of interest being 10.75% p.a.
The Retirement Benefits of Vinay after 15 years hence, are expected to be as follows:
Vinay has taken a term insurance of Rs. 30 lakh for 20 years, which is expiring 5 years from now. He has no other insurance. Vinay's monthly household/ living expenses are Rs. 50,000. This excludes EMI on loans but includes all other expenses including expenses on his mother's care.
Vinay expects Deepika to get married 12 years hence for which likely expenditures in today's term is 15 lakh.
Vinay's salary is likely to grow at 7% pa and Reena's salary is likely to grow at 6% p.a. Risk free rate of interest is 8% pa and inflation is 6% p.a. Long term growth on Equity/Equity based MF is taken as 15% p.a.
NEW QUESTION 750
Section A (1 Mark)
Debt investments in real estate, such as mortgages or deeds of trust, are called income property investments.
- A. FALSE
- B. TRUE
Answer: A
NEW QUESTION 751
......
CWM_LEVEL_2 Braindumps Real Exam Updated on Mar 05, 2022 with 1234 Questions: https://www.realvalidexam.com/CWM_LEVEL_2-real-exam-dumps.html
