Chapter 3 MC

Question 1

. Which of the following statements concerning ethics in business is correct?

Answer 1

It is about how people conduct business every day

Question 2

The second financial planning domain (determining goals and gathering data) is related to which of the following Practice Standards?

Answer 2

obtaining quantitative information and documents

Question 3

Most ethics codes applicable to financial advisors share which of the following common themes and sentiments? I. They require advisors to continue the learning process throughout their careers. II. They call on advisors to look out for their own best interests.

Answer 3

I only

II is incorrect because the codes C ALL on advisors to look out for the best interests of clients.

Question 4

Which of the following statements concerning The American College’s Code of Ethics is (are) correct? I. Enforcement of the code is through specified procedures. II. Violations of the code are subject to disciplinary sanctions.

Answer 4

Both I and II

Question 5

Which of the following statements concerning the CFP Board’s Practice Standards is (are) correct? I. They are enforceable by the CFP Board against CFP designees. II. They are designed to be a basis for legal liability when they are breached.
Answer

Answer 5

I only

Question 6

Which of the following statements concerning financial advisors as professionals is (are) correct? I. They are held to higher standards in the execution of their business duties. II. They are expected to place their own business interests above those of clients.

Answer 6

I only

Question 7

As relates to the Principle of Professionalism, a CFP Board designee shall do all of the following EXCEPT

Answer 7

offer advice only in those areas in which the CFP Board designee has competence

Question 8

All the following Practice Standards are related to domain 4 (developing a plan) of the financial planning process EXCEPT

Answer 8

determining a client’s personal and financial goals, needs, and priorities