CII R01 Mock Test 1 Questions with Verified
Correct Answers
What does the UK Government use to fund its borrowing?
Fixed interest investments and National Savings and Investments
Gilts are loans to the UK Government. How do they pay out?
They pay a fixed level of interest at regular intervals
Capital markets developed to meet what objective?
To invest in assets which offer potential for real growth, and allow companies to raise money
without going to banks
Who oversees the UK payments system?
The Bank of England
Your client, Jeremy, has asked you to confirm what a discretionary portfolio
management service is. You tell him that it is a service where:
specialist investment managers make the investment decisions to meet the client's investment
objectives
What can be directly attributed to the impact of taxation?
The individual consumer's ability to make investments
Janey met with her financial adviser to discuss, among other things, her budget for
protection needs. When considering Janey's expenditure, how should it be categorised?
Essential, every day and occasional spending
, What is a key consideration for those entering the commercial buy to-let property
market?
Commercial buy-to-let mortgages are not regulated by the Financial Conduct Authority
Your client, Jayden, is surprised that he is not able to protect his full income in the
event of illness. Why do most insurers limit the amount of benefit they will provide
under Income Protection policies?
To prevent the individual getting more income than they would by working
At Henry's forthcoming financial review, his adviser wishes to discuss his flexible whole
of life policy. Why do these policies need to be reviewed regularly?
To ensure the premiums are sufficient to sustain the required level of cover
Why might Harriet, a 27-year-old working mother of two young children, consider
reviewable critical illness cover?
Premiums are considerably cheaper than a guaranteed premium policy
Following the Pensions Act 2014, the State pension age is expected to be reviewed at
least every:
6 years
Gregor is a member of his firm's defined benefit scheme. What are the main features of
a defined benefit pension scheme?
A fund administered by trustees where the pension is earnings related
You are reviewing the financial planning needs of a young couple, Simon and Jess, with
two children under the age of 5. What would your general priorities be for them before
they considered saving and investment?
Correct Answers
What does the UK Government use to fund its borrowing?
Fixed interest investments and National Savings and Investments
Gilts are loans to the UK Government. How do they pay out?
They pay a fixed level of interest at regular intervals
Capital markets developed to meet what objective?
To invest in assets which offer potential for real growth, and allow companies to raise money
without going to banks
Who oversees the UK payments system?
The Bank of England
Your client, Jeremy, has asked you to confirm what a discretionary portfolio
management service is. You tell him that it is a service where:
specialist investment managers make the investment decisions to meet the client's investment
objectives
What can be directly attributed to the impact of taxation?
The individual consumer's ability to make investments
Janey met with her financial adviser to discuss, among other things, her budget for
protection needs. When considering Janey's expenditure, how should it be categorised?
Essential, every day and occasional spending
, What is a key consideration for those entering the commercial buy to-let property
market?
Commercial buy-to-let mortgages are not regulated by the Financial Conduct Authority
Your client, Jayden, is surprised that he is not able to protect his full income in the
event of illness. Why do most insurers limit the amount of benefit they will provide
under Income Protection policies?
To prevent the individual getting more income than they would by working
At Henry's forthcoming financial review, his adviser wishes to discuss his flexible whole
of life policy. Why do these policies need to be reviewed regularly?
To ensure the premiums are sufficient to sustain the required level of cover
Why might Harriet, a 27-year-old working mother of two young children, consider
reviewable critical illness cover?
Premiums are considerably cheaper than a guaranteed premium policy
Following the Pensions Act 2014, the State pension age is expected to be reviewed at
least every:
6 years
Gregor is a member of his firm's defined benefit scheme. What are the main features of
a defined benefit pension scheme?
A fund administered by trustees where the pension is earnings related
You are reviewing the financial planning needs of a young couple, Simon and Jess, with
two children under the age of 5. What would your general priorities be for them before
they considered saving and investment?
