General Principles

Question 1

Details about the scope of engagement

Answer 1

• Must be in writing
• Can be revised
• Can be segmented

Question 2

What does PITI stand for?

Answer 2

Principle + Interest + Taxes + Insurance

Question 3

UTMA

Answer 3

Does allow real estate. Can be invested in any cash-type investment.

Question 4

Interplay between college payment techniques

Answer 4

The following cannot be used in conjunction with one another (to pay for the same expense - i.e. Tuition):

American Opportunity Credit
Lifetime Learning Credit
ESA
529

Question 5

What are the best transfer agreements for unmarried couples and same sex partners?

Answer 5

Revocable Trust and Tenancy in Common

Question 6

Important Leading Indicators

Answer 6

Unemployment claims
New Manufacturing Orders
New Private Housing units
Stock Prices
Consumer expectations
PPI

Question 7

Lagging Indicators

Answer 7

Consumer Credit
CPI
Average duration of unemployment

Question 8

Is a broker authorized to bind coverage?

Answer 8

No

Question 9

Chapter 7 Bankruptcy - Ineligibility

Answer 9

If the debtor’s monthly net income for 60 months exceeds 10,000…Ch.7 is not an option.

Question 10

Establishing and Defining the Relationship - is a brochure necessary here?

Answer 10

No

Question 11

True or false: Referral fees violate the principle of Fairness.

Answer 11

False - if the nature and source of the referral fee are disclosed.

Question 12

Investment COMPANY Act of 1940

Answer 12

Gave the SEC the power to regulate mutual funds

Question 13

Form ADV - General Details

Answer 13

Part I - Address, background,

Part II - Compensation agreement, services provided, brochure