FPQP Exam (Finance) Questions and
Already Solved Solutions 2026-2027
Updated.
Properly stated financial goals should contain each of these factors - Answer amount, time,
purpose
r=the front-end ratio (debt-to-income) should be - Answer less than our equal to 28% of gross
income
For a high severity high probability event, what should be the preferred risk management
strategy - Answer risk reduction and risk avoidance
An investment of $6,00 earning 6.4% per year will be worth ___ in 4 years - Answer $7,690
The ethical principles of diligence for the Financial Paraplanner Qualified Professional (FPQP) i
most closely summarized by which statement - Answer Conduct of a financial planner that
reflects timely response to reasonable client inquiries
You want to have $30,000 two years from today to buy a new car. You start investing one month
from today with your first payment. You decide on an annual rate of return of 2.4%. What is the
monthly payment you need to achieve your goal in 2 years? - Answer $1,221
Best describe the components necessary to become a CFP professional - Answer Successful
completion of the education, exam, experience and ethics requirement
According to the CFFP, what is a good minimus Savings ratio as a Percent of total income -
Answer 10%
What is the major difference between insurance and brokers? - Answer An agent can bind the
insurance company, but a broker cannot
You just got a $350,000 loan for 30 years to buy a home. What is your monthly mortgage
payment (principal + interest) if the annual interest rate is 4.8%? - Answer not $1400
Which is an example of "fee-only" financial planning - Answer not "getting a commission for
the sale of a financial product and an advisory fee for managing money"
,What is the acceptable level of housing costs as a percentage of gross Income - Answer 28% or
less
What is the major difference between a stock and a mutual insurance company - Answer not
stock companies distribute their dividends to policyholders
Which is included in systematic risk? - Answer interest rate risk
determining the appropriate asset allocation for the achieving a client goal should take place in
what step of the financial planning process - Answer Step 4: developing the financial planning
considerations
What would be the appropriate price movement if a mutual find has a beta of 1.07 and the
benchmark it is being compared to (eg S&P 500) has a return of a minus 7.6% - Answer 8.13%
What benefit do umbrella insurance policies have for policyholders - Answer not all the above
Mutual find a has a return of 14.2% and a beta of 1.26. Mutual fund b has a return of 9.5% and
a beta of .76. for a risk-adjusted return which mutual fund should be chosen? - Answer Mutual
fund b because risk-adjusted ratio is 12.5 vs a at 11.27
a coininsurnace penalty for dwelling coverage on a homeowners insurance contract is intended
to have what impact? - Answer to incentivize the homeowner to have adequate coverage to
repair or rebuild a dwelling or other structures
Assume today is May 1. How much money needs to be invested starting today, as the beginning
of each month for 17 months, to have FV of $11,500? You use an annual rate of return of 6.6% -
Answer $643
best reflects a fiduciary standard of care - Answer putting the client first
You decide on 15-year $310,000 mortgage at an annual interest rate of 3.8%. What is your
monthly mortgage payment (principal plus interest) - Answer not 1,854
A bond pays $55 per year in annual interest. what is the coupon rate - Answer 5.5%
Which of the following is a best practice when approaching financial planning? - Answer
reevaluating financial plans periodically
, Best example of a moral hazard in insurance - Answer lying about getting hurt in order to claim
disability insurance
You purchased a mutual find 4 years ago with an investment of $8,000. Today because of covid-
19, it is worth only $7,500 what is your compounded annual average rate of return over the last
4 years? - Answer 1.6%
4 major asset classes - Answer cash, cash equivalents, bonds
What is the current level of insured deposits per account by the federal deposit insurance
corporation FDIC - Answer $250,000
Regarding a strategy of carrying a high deductible for collision on your auto insurance? - Answer
Having a high deductible for collision coverage is desirable as it creates an incentive for the
insured to drive more carefully
Features of an insurance contract - Answer there is a need for an insurable interest at the time
of loss, insurance is a unilateral agreement between the insurance company and the insured,
insurance contracts can have riders or endorsements that supplement the basic coverage
During step 3 of the financial planning process, "Analyzing the client's current course of action
and potential alternative courses(s) of action...", which are possible "red flags" the planner may
encounter? - Answer insufficient liquid assets, mismatches between the clients time horizon
and stated goals, non-advantageous tilting of assets and not naming beneficiaries
What are the 2 components of total return for stocks and bonds - Answer capital appreciation
and dividends/interest
Characteristic of bonds - Answer callable bonds, coupon rate, credit ratings
How much debt a company uses is an example of what type of unsystematic risk - Answer
financial risk
if you think interest rates are going to increase, then you would want a duration of _____ years
for your bond - Answer not six
ETSs are _____ marketable when compared to mutual funds - Answer more
A 4% coupon bond has 7 years left to maturity. If interest rates increase to 5%, what is the
current value of the bond? assume coupon is paid semiannually - Answer $942
Already Solved Solutions 2026-2027
Updated.
Properly stated financial goals should contain each of these factors - Answer amount, time,
purpose
r=the front-end ratio (debt-to-income) should be - Answer less than our equal to 28% of gross
income
For a high severity high probability event, what should be the preferred risk management
strategy - Answer risk reduction and risk avoidance
An investment of $6,00 earning 6.4% per year will be worth ___ in 4 years - Answer $7,690
The ethical principles of diligence for the Financial Paraplanner Qualified Professional (FPQP) i
most closely summarized by which statement - Answer Conduct of a financial planner that
reflects timely response to reasonable client inquiries
You want to have $30,000 two years from today to buy a new car. You start investing one month
from today with your first payment. You decide on an annual rate of return of 2.4%. What is the
monthly payment you need to achieve your goal in 2 years? - Answer $1,221
Best describe the components necessary to become a CFP professional - Answer Successful
completion of the education, exam, experience and ethics requirement
According to the CFFP, what is a good minimus Savings ratio as a Percent of total income -
Answer 10%
What is the major difference between insurance and brokers? - Answer An agent can bind the
insurance company, but a broker cannot
You just got a $350,000 loan for 30 years to buy a home. What is your monthly mortgage
payment (principal + interest) if the annual interest rate is 4.8%? - Answer not $1400
Which is an example of "fee-only" financial planning - Answer not "getting a commission for
the sale of a financial product and an advisory fee for managing money"
,What is the acceptable level of housing costs as a percentage of gross Income - Answer 28% or
less
What is the major difference between a stock and a mutual insurance company - Answer not
stock companies distribute their dividends to policyholders
Which is included in systematic risk? - Answer interest rate risk
determining the appropriate asset allocation for the achieving a client goal should take place in
what step of the financial planning process - Answer Step 4: developing the financial planning
considerations
What would be the appropriate price movement if a mutual find has a beta of 1.07 and the
benchmark it is being compared to (eg S&P 500) has a return of a minus 7.6% - Answer 8.13%
What benefit do umbrella insurance policies have for policyholders - Answer not all the above
Mutual find a has a return of 14.2% and a beta of 1.26. Mutual fund b has a return of 9.5% and
a beta of .76. for a risk-adjusted return which mutual fund should be chosen? - Answer Mutual
fund b because risk-adjusted ratio is 12.5 vs a at 11.27
a coininsurnace penalty for dwelling coverage on a homeowners insurance contract is intended
to have what impact? - Answer to incentivize the homeowner to have adequate coverage to
repair or rebuild a dwelling or other structures
Assume today is May 1. How much money needs to be invested starting today, as the beginning
of each month for 17 months, to have FV of $11,500? You use an annual rate of return of 6.6% -
Answer $643
best reflects a fiduciary standard of care - Answer putting the client first
You decide on 15-year $310,000 mortgage at an annual interest rate of 3.8%. What is your
monthly mortgage payment (principal plus interest) - Answer not 1,854
A bond pays $55 per year in annual interest. what is the coupon rate - Answer 5.5%
Which of the following is a best practice when approaching financial planning? - Answer
reevaluating financial plans periodically
, Best example of a moral hazard in insurance - Answer lying about getting hurt in order to claim
disability insurance
You purchased a mutual find 4 years ago with an investment of $8,000. Today because of covid-
19, it is worth only $7,500 what is your compounded annual average rate of return over the last
4 years? - Answer 1.6%
4 major asset classes - Answer cash, cash equivalents, bonds
What is the current level of insured deposits per account by the federal deposit insurance
corporation FDIC - Answer $250,000
Regarding a strategy of carrying a high deductible for collision on your auto insurance? - Answer
Having a high deductible for collision coverage is desirable as it creates an incentive for the
insured to drive more carefully
Features of an insurance contract - Answer there is a need for an insurable interest at the time
of loss, insurance is a unilateral agreement between the insurance company and the insured,
insurance contracts can have riders or endorsements that supplement the basic coverage
During step 3 of the financial planning process, "Analyzing the client's current course of action
and potential alternative courses(s) of action...", which are possible "red flags" the planner may
encounter? - Answer insufficient liquid assets, mismatches between the clients time horizon
and stated goals, non-advantageous tilting of assets and not naming beneficiaries
What are the 2 components of total return for stocks and bonds - Answer capital appreciation
and dividends/interest
Characteristic of bonds - Answer callable bonds, coupon rate, credit ratings
How much debt a company uses is an example of what type of unsystematic risk - Answer
financial risk
if you think interest rates are going to increase, then you would want a duration of _____ years
for your bond - Answer not six
ETSs are _____ marketable when compared to mutual funds - Answer more
A 4% coupon bond has 7 years left to maturity. If interest rates increase to 5%, what is the
current value of the bond? assume coupon is paid semiannually - Answer $942
