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CWM_LEVEL_2 Exam Dumps - AAFM Chartered Wealth Manager Questions and Answers

Question # 169

Section A (1 Mark)

Another name for open-end credit is:

Options:

A.

Revolving credit.

B.

A box of credit.

C.

Convenience credit.

D.

Installment credit.

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Question # 170

Section A (1 Mark)

Debt investments in real estate, such as mortgages or deeds of trust, are called income property investments.

Options:

A.

TRUE

B.

FALSE

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Question # 171

Section A (1 Mark)

Guarantees covering security deposit/earnest money/advance payment/ mobilization advance etc. would come under__________________ category

Options:

A.

Financial Guarntees

B.

Performance Guarntees

C.

Deferred Payment Guarntees

D.

None of the Above

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Question # 172

Section B (2 Mark)

Which of the following is an assumption of two stage dividend discount model?

Options:

A.

This model assumes two stages of growth, the first phase in which the growth rate is high and the second phase which represents steady state in which the growth rate is assumed to be stable and is expected to continue for a long-term.

B.

This model assumes two stages of growth, the first phase in which the growth rate is low and the second phase which represents steady state in which the growth rate is assumed to be stable and is expected to continue for a long-term.

C.

This model assumes two stages of growth, the first phase in which the growth rate is high and the second phase which represents steady state in which the growth rate is assumed to be stable and is expected to continue for next two years.

D.

None of the above.

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Question # 173

Section B (2 Mark)

What is the projected sale price of an apartment building that produces an annual net cash flow Rs. 120,000, if we set a projected capitalization rate at 7%?

Options:

A.

Rs. 17, 14,286

B.

Rs. 1,28,400

C.

Rs. 1,92,694

D.

Rs. 1,68,306

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Question # 174

Section A (1 Mark)

The eligibility Criteria for Personal Loans Salaried Individuals for Maximum Age of Applicant at Loan Maturity in case of personal loan is:

Options:

A.

58 Years

B.

60 Years

C.

65 Years

D.

None of These

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Question # 175

Section C (4 Mark)

As a CWM you are required to calculate the tax liability of an individual whose Taxable income is:

• $125000 in US dollars and he is a US citizen (single individual)

• $109000 in SGD and he is a citizen of Singapore

Options:

A.

27450.10 USD and 14780 SGD

B.

28460.50 USD and 15680 SGD

C.

24580.50 USD and 16100 SGD

D.

26480 USD and 15870 SGD

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Question # 176

Section B (2 Mark)

Total income of an individual including long-term capital gain of Rs. 50,000 is Rs. 1,10,000, the tax on total income shall be:

Options:

A.

Rs. 1,020

B.

Rs. 2,040

C.

Rs. 2,244

D.

Rs. 3,240

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Question # 177

Section B (2 Mark)

Which of the following statements is/are correct?

Options:

A.

I, II and III

B.

I, III and IV

C.

II, III and IV

D.

All of the above

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Question # 178

Section B (2 Mark)

Suppose that Chicken Express, Inc. has a ROA of 7% and pays a 6% coupon on its debt. Chicken Express has a capital structure that is 70% equity and 30% debt. Relative to a firm that is 100% equity-financed, Chicken Express’s Net Profit will be ________ and its ROE will be ________.

Options:

A.

Lower, lower

B.

Higher, higher

C.

Higher, lower

D.

Lower, higher

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Question # 179

Section C (4 Mark)

Roger deposits Rs. 10,00,000 in a bank account on 1st March 2005 and another Rs. 5,00,000 on 1st March 2011. He wants to withdraw all of this money with interest on 1st March 2015. If the account pays ROI of 11% p.a. compounded quarterly what amount can he withdraw from this account?

Options:

A.

2959874

B.

771755

C.

3731629

D.

3598455

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Question # 180

Section A (1 Mark)

Why have consumers/customers been so hyper-aware and so nervous?

Options:

A.

Much more information is collected and seemingly available to more people at much faster rate.

B.

Much more information is collected and seemingly not available to more people at much faster rate.

C.

Much more information is not collected and seemingly available to more people at much faster rate.

D.

Much more information is not collected and seemingly not available to more people at much faster rate.

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Question # 181

Section C (4 Mark)

Pacific Asia reported net income of Rs770 million in 1993, after interest expenses of Rs320 million. (The corporate tax rate was 36%.) It reported depreciation of Rs960 million in that year, and capital spending was Rs1.2 billion. The firm also had Rs4 billion in debt outstanding on the books, rated AA (carrying a yield to maturity of 8%), trading at par (up from Rs3.8 billion at the end of 1992). The beta of the stock is 1.05, and there were 200 million shares outstanding (trading at Rs60 per share), with a book value of Rs5 billion. Pacific Asia paid 40% of its earnings as dividends and working capital requirements are negligible. (The Risk Free rate is 7%.)

Estimate the free cash flow to the firm in 1993.

Options:

A.

Rs785.45

B.

Rs 734.80

C.

Rs 689.20

D.

Rs 161.75

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Question # 182

Section A (1 Mark)

What amount needs to be invested today at 10 % per annum, so that it pays Rs. 1 lac per annum for 5 years, starting from 6th year to 10thyear. First payment starts at BEGIN of 6thyear.?

Options:

A.

258915.49

B.

416986.23

C.

262923.34

D.

423789.34

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Question # 183

Section A (1 Mark)

Which among the following is not an advantage of setting up a trust?

Options:

A.

Allows for orderly distribution of assets and income following death

B.

Ensures that the estate poses to the intended beneficiaries

C.

Tax planning

D.

Protects against money laundering

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Exam Code: CWM_LEVEL_2
Exam Name: Chartered Wealth Manager (CWM) Certification Level II Examination
Last Update: Jan 31, 2025
Questions: 1259
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