Free CSI FP2 Exam Questions

Question 1

What is the most common going-concern valuation method used to determine the value of a business?

A : Discounted cash flow.

B : Capitalization of earnings.

C : Adjusted book value.

D : Liquidation value.

Answer: B

Question 2

Shelley has been engaged in the financial planning process with her client Kim. Shelley has just obtainedpermission from Kim to refer her to a lawyer for estate planning considerations.What stage of the financial planning process are Shelley and Kim in?

A : Collecting data and information.

B : Analyzing data and information.

C : Establishing the client/advisor relationship.

D : Implementing recommendations.

Answer: D

Question 3

Joshua and Marie are siblings who inherited an apartment building from their parents, which they now ownjointly. They share the net profits equally, but they do not have a signed agreement.What ruling will the courts apply with respect to the existence of a partnership?

A : They are deemed to be partners because they both have ownership in the apartment building.

B : They are deemed to be partners because they share net profits.

C : They are deemed not to be partners because they do not have a written agreement.

D : They are deemed not to be partners because they are operating at non-arm's length.

Answer: B

Question 4

Shelley has been engaged in the financial planning process with her client Kim. Shelley has just obtainedpermission from Kim to refer her to a lawyer for estate planning considerations.What stage of the financial planning process are Shelley and Kim in?

A : Collecting data and information.

B : Analyzing data and information.

C : Establishing the client/advisor relationship.

D : Implementing recommendations.

Answer: D

Question 5

Samuel bought a permanent life insurance policy many years ago. The policy now has a cash value of$40,000. Samuel is recently widowed and has two minor children that he supports. Since his wife passedaway, he finds himself struggling to pay the bills, however he still needs the same death benefit andpermanent life insurance. Considering his personal and financial situation, what would be the best nonforfeiture option to exercise on Samuel's policy to meet his needs?

A : Reduced paid-up insurance.

B : Cash surrender.

C : Extended term insurance.

D : Automatic premium loan.

Answer: D