CANON TRUST I VOCAB EXAM
QUESTIONS AND ANSWERS
The person who is entitled to an estate after the prior estate has expired. - Correct
Answers -Remainderman
The value at which estate property is included in the gross estate for Federal Estate Tax
purposes. - Correct Answers -Fair Market Value (FMV)
A right to future enjoyment by the transferor of property that is now in the possession or
enjoyment of another party. - Correct Answers -Reversionary interest
Make an irrevocable trust qualify for the gift tax annual exclusion by creating a BLANK
interest. - Correct Answers -Present
Property acquired during marriage in which both husband and wife have an undivided
one half interest. - Correct Answers -Community property
A tax on the unearned income of a minor child - Correct Answers -Kiddie tax
Monetary policy - Correct Answers -The Federal Reserve alters the money supply and
interest rates in an attempt to affect the economy
How can the Fed manipulate the money to impact the economy? - Correct Answers --
Buy securities to increase the money supply and add liquidity to the economy
(stimulate)
- Sell securities to decrease the money supply and reduce liquidity (slow)
Best long-term impact on how a stock will perform - Correct Answers -Management
Best short-term impact on how a stock will perform - Correct Answers -Economy
Cyclical Stocks - Correct Answers -Stocks whose success is closely linked to the rise
and fall of the general economy.
Best to purchase in the early expansion. They are also known as boom and bust stocks.
Think automobiles and appliances.
, Defensive Stocks - Correct Answers -Stocks that remain stable during economic
declines. They hold value during recessions. These are tame "sin stocks" - Coke, Pepsi,
food, tobacco. Because of this - healthcare stocks also perform well in recessions.
Additionally - the necessities, like toiletries. Purchase when near the peak of the
economic cycle..
The postponed right of use or enjoyment of property. - Correct Answers -Future interest
Person or entity entitled to receive benefits from a will, insurance policy, trust agreement
or employee benefit plan. - Correct Answers -Beneficiary
Property which can be touched or realized with the senses, such as a chair - Correct
Answers -Tangible property
Valued at FMV on the date of the transfer. - Correct Answers -Gifts
Property which cannot be touched or realized with the senses, such as a legally
enforceable right. - Correct Answers -Intangible property
A future interest that comes into existence after the termination of a prior interest. -
Correct Answers -Remainder interest
Land and/or the buildings and other fixed improvements on the land. - Correct Answers
-Real property
A deduction allowed for a gift to a qualified charitable organization. - Correct Answers -
Charitable deduction
An interest that a person has in property which is enjoyed only during life. - Correct
Answers -Life estate
Ownership of property by two or more persons so that each has an undivided interest
which at the death of one is passed by will to the deceased's heirs. - Correct Answers -
Tenancy in Common
The total value of all property in which a deceased had an interest and which must be
included in his or her estate. - Correct Answers -Gross estate
A provision allowing a married couple to treat a gift made by one of them to a third party
as having been made one-half by each, provided it is consented to by the other on the
Gift Tax Return - Correct Answers -Gift splitting
Ownership of property by two or more persons so that when one dies, the survivor takes
the entire property - Correct Answers -Joint tenancy
QUESTIONS AND ANSWERS
The person who is entitled to an estate after the prior estate has expired. - Correct
Answers -Remainderman
The value at which estate property is included in the gross estate for Federal Estate Tax
purposes. - Correct Answers -Fair Market Value (FMV)
A right to future enjoyment by the transferor of property that is now in the possession or
enjoyment of another party. - Correct Answers -Reversionary interest
Make an irrevocable trust qualify for the gift tax annual exclusion by creating a BLANK
interest. - Correct Answers -Present
Property acquired during marriage in which both husband and wife have an undivided
one half interest. - Correct Answers -Community property
A tax on the unearned income of a minor child - Correct Answers -Kiddie tax
Monetary policy - Correct Answers -The Federal Reserve alters the money supply and
interest rates in an attempt to affect the economy
How can the Fed manipulate the money to impact the economy? - Correct Answers --
Buy securities to increase the money supply and add liquidity to the economy
(stimulate)
- Sell securities to decrease the money supply and reduce liquidity (slow)
Best long-term impact on how a stock will perform - Correct Answers -Management
Best short-term impact on how a stock will perform - Correct Answers -Economy
Cyclical Stocks - Correct Answers -Stocks whose success is closely linked to the rise
and fall of the general economy.
Best to purchase in the early expansion. They are also known as boom and bust stocks.
Think automobiles and appliances.
, Defensive Stocks - Correct Answers -Stocks that remain stable during economic
declines. They hold value during recessions. These are tame "sin stocks" - Coke, Pepsi,
food, tobacco. Because of this - healthcare stocks also perform well in recessions.
Additionally - the necessities, like toiletries. Purchase when near the peak of the
economic cycle..
The postponed right of use or enjoyment of property. - Correct Answers -Future interest
Person or entity entitled to receive benefits from a will, insurance policy, trust agreement
or employee benefit plan. - Correct Answers -Beneficiary
Property which can be touched or realized with the senses, such as a chair - Correct
Answers -Tangible property
Valued at FMV on the date of the transfer. - Correct Answers -Gifts
Property which cannot be touched or realized with the senses, such as a legally
enforceable right. - Correct Answers -Intangible property
A future interest that comes into existence after the termination of a prior interest. -
Correct Answers -Remainder interest
Land and/or the buildings and other fixed improvements on the land. - Correct Answers
-Real property
A deduction allowed for a gift to a qualified charitable organization. - Correct Answers -
Charitable deduction
An interest that a person has in property which is enjoyed only during life. - Correct
Answers -Life estate
Ownership of property by two or more persons so that each has an undivided interest
which at the death of one is passed by will to the deceased's heirs. - Correct Answers -
Tenancy in Common
The total value of all property in which a deceased had an interest and which must be
included in his or her estate. - Correct Answers -Gross estate
A provision allowing a married couple to treat a gift made by one of them to a third party
as having been made one-half by each, provided it is consented to by the other on the
Gift Tax Return - Correct Answers -Gift splitting
Ownership of property by two or more persons so that when one dies, the survivor takes
the entire property - Correct Answers -Joint tenancy
