Questions:

(Please provide all answers in excel)

Q 1. Mr. Sunny has planned that he would need a sum of Rs 8 crores when he retires. His
retirement is 22 years away. The returns on investment can be estimated at 7.6%
What would be the investments he need to make at the end of each year for the next 22
years to achieve his retirement corpus goal.

a. Rs. 16,74,960
b. Rs. 15,16,068
c. Rs. 17,11,634
d. Rs. 18,22,721

Q 2. Govind is of 30 years and he has planned to retire at the age of 55 years. His
current yearly income is Rs 12 lakhs which he expects to grow at 10% every year. What
will be the income required by Govind in retirement if he requires an income
replacement of 75%?
a. Rs 76,55,175
b. Rs 83,53,411
c. Rs 89,85,400
d. Rs 97,51,235

Q 3. Mr. A is 40 years old and receives a salary of Rs 80,000 per month. He has a life
insurance cover of Rs 20 lakhs. He wants to make sure that his family will continue to
have the income to meet their expenses even if he dies by taking sufficient insurance
cover. He plans to retire after 20 years. What will be additional insurance cover Mr. A will
need to enable this? The inflation is at 6% and investment returns are at 8%.

a. Rs. 1.76 crores

b. Rs. 1.59 crores
c. Rs. 1.33 crores
d. Rs. 1.03 crores

Q 4. Ms. Supriya is of age 38 years and she done her investments in the following ratios in
various asset classes :
Equity : 50%
Gold : 20%
Debt : 10%
Liquid Assets : 20%

In the last financial year, the compounded annual growth rates from these asset classes
have been 30%, 15%, 8% and 6% respectively.
Calculate the asset allocation in Supriya’s portfolio at the end of the year.
a. 52.5 : 23 : 7.5 : 17
b. 45.75 : 21.50 : 11.50 : 21.25

c. 48 : 25.25 : 13 : 13.75
d. 54.5 : 19.3 : 8.45 : 17.75

Q 5. Dimple is creating a corpus to meet her son’s educational needs. For this she is already
investing in an equity mutual fund. Her son is planning to do a 2 year specialized course
which is currently costing Rs 5 lakhs. This course will commence after 6 years. Inflation is at
10%.
To protect this corpus from equity volatility, she plans to shift the required sum of money
from the equity fund to a debt fund after 5 years. The returns on debt fund is at 6.5%.
Calculate how much amount which Dimple has accumulated should be moved into the debt
fund at the end of 5 years to finance the two years of education.

Q6- Ms. Shreya is receiving a salary of Rs 1,00,000 per month. She has taken a 12% personal
loan with an outstanding of Rs. 5 lakh and four years to go. She also has taken a 8% home
loan with an outstanding of Rs 32 lacs and 10 years to go.
Shreya’s grandfather has gifted her Rs. 5,00,000. She wants to use this amount to improve
her financial situation.
Identify which of these can be the optimum use of the gift received by Shreya to better her
financial situation?
a. It will be advisable for Shreya to pay off the personal loan which will bring down the
Debt-to-Income Ratio from 63% to 32%
b. It will be advisable for Shreya to pay off the personal loan which will bring down the
Debt-to-Income Ratio from 43% to 30%
c. It will be advisable for Shreya to pay off the personal loan which will bring down the
Debt-to-Income Ratio from 60% to 27%
d. It will be advisable for Shreya to pay off the personal loan which will bring down the
Debt-to-Income Ratio from 52% to 39%

Q 7. Mr. Tejas has a monthly income of Rs 100000. When he will retire, he expects that his
expenses will be 50% of his current income and he expects to fund 25 years in retirement.
Mr. Tejas is a disciplined investor and he has invested Rs. 5000 every month in good equity
funds for the last 8 years. He intends to continue with this to contribute to his retirement
corpus.
Consider long term returns from equity funds at 10%, inflation at 6% and investment
return in retirement at 7.5%.
Calculate the corpus that Mr. Tejas will require to fund his retirement. Also calculate the
additional amount that Mr. Tejas will have to set aside for this apart from continuing his
investment in equity funds?
a. Rs. 5.41 crores ; Rs. 29,180
b. Rs. 4.33 crores ; Rs. 25,750
c. Rs. 4.89 crores ; Rs. 32,100
d. Rs. 6.74 crores ; Rs. 17,240

Q8 - Mr Ravi Gupta, aged 45 years, saves Rs 55000 p.m. Based on salary growth and other
factors, he expects this to rise by 10% p.a. till his retirement at age 60. This does not include
monthly contributions of Rs 15000 (own contribution plus employer contribution) to various
funds towards retirement corpus. These are expected to grow by 6% pa till retirement. The
retirement corpus by the end of the current year will be Rs 30 lakhs, entirely in debt which
will yield 7% pa on average.
Calculate the amount Mr. Ravi will have in his retirement corpus on his retirement.

a. Rs. 153 lakhs

b. Rs. 148 lakhs
c. Rs. 133 lakhs
d. Rs. 169 lakhs

Q 9 – Rahul is 35 years old and he is working for an IT company. He gets a salary of Rs.
1,00,000 from which he spends Rs. 10% for his own expenses.
Rahul wants to take an insurance cover which will provide for the expenses in case he dies,
for his wife who is 30 years old. Rahul plans to retire at 60 years and he expects his wife to
live for 85 years. Inflation is at 6% and investment return at 7.5%.
Calculate the insurance cover that Rahul should take for providing a corpus to meet the
household expenses and goals in case he dies.
a. Rs. 3.96 crores
b. Rs. 5.06 crores
c. Rs. 3.77 crores
d. Rs. 4.12 crores

Q 10 - Mr. Y, aged 40, has the following goals ahead of him.

A - Son's post-graduate education: Due in Year 5. Current cost Rs15,00,000 p.a. to be

incurred at the end of each year for 2 years. Likely Inflation 15% p.a.
B - Daughter's marriage: Scheduled in end of Year 7. Current cost Rs1,00,00,000. Inflation is
assumed to be at 10% p.a. Mr. Y has provided a corpus of Rs2,00,00,000 towards these two
needs. The corpus is invested in a mix of debt and equity yielding 8% p.a. Ignore taxation.
Q 10.1 How much money will need to be set apart from the corpus at the end of Year 5, to
finance the son's post-graduate education? Assume the amount set apart will earn 6%
interest.
a. Rs. 59,34,184
b. Rs. 62,90,235
c. Rs. 64,12,209
d. Rs. 60,35,259
Q 10.2 What is the likely outflow on account of daughter's marriage in the year it is
planned?
a. Rs. 1,94,87,171
b. Rs. 1,77,15,610
c. Rs. 2,14,35,888
d. Rs. 2,05,10,865

Q 10.3 How much will be left in the corpus after both goals are fulfilled (assume that he
does not set apart money in the 6% corpus mentioned in Q10.1)?
a. Rs. 81,24,932
b. Rs. 69,65,820
c. Rs. 75,23,085
d. Rs. 66,42,292

Q 11. Mr. Vishal, age 47 years has a monthly salary of Rs. 350000. He spends Rs. 50000 for is
own expenses. He has also taken a 15 year – Rs. 1 crore home loan for which he pays an EMI
of Rs. 90000 with Rs. 70 lakhs outstanding. He also has a Rs. 1.5 crore term policy for which
he pays an insurance premium of Rs. 30000.
The company in which Mr. Vishal works has given him a bonus of Rs. 8 lakhs. He feels he
should use it to pre-pay some part of the home loan.
He has estimated that he will need Rs. 1.3 crore to take care his children’s needs. For this he
is investing Rs. 1 lakh every month in an equity fund. This corpus fund is now worth Rs. 25
lakhs.
After all the above expenses and savings, the balance amount is used for household
expenses. The age of Mr. Vishal’s wife is 45 years and she is expected to live till 85 years.
Mr. Vishal wants to make sure that there is adequate insurance for all expenses and to
provide for his wife in case of his death.
The Provident Fund account of Mr. Vishal has a balance of Rs. 35 Lakhs which is earning a
return of 7.5% pa. The average yearly contribution to provident fund has been estimated at
Rs. 350000 pa during his employed years.
Mr. Vishal plans to retire at 60 years and expects to fund 25 years in retirement. The
expenses in retirement will be 90% of his current household expenses. He has daughter –
Preeti. Mr. Vishal has to draw on the corpus fund for Preeti’s two years masters program
which is after 6 years. This masters program is costing Rs 20 lakhs each year today. To
safeguard her goal against volatility in the equity markets, Mr. Vishal plans to shift the
required amount to a short duration debt fund after 5 years.
Mr. Vishal’s employer has provided a health insurance cover for his family for Rs. 5 Lakhs.
He feels that this is inadequate and so has taken a top-up of policy of Rs. 10 lakhs with Rs. 3
lakhs deductible.
(Returns outlook : Conservative Return @ 7.5%, Long term Equity Returns @ 12% and Short
term debt fund @ 6.5%. Inflation linked to education @ 10% and general inflation @ 6%)
Answer the below questions based on this data.
Q 11.1 During the financial year, there were three expenditures due to hospitalizations. The
amount spent was Rs. 2 lakhs, Rs 6 lakhs and Rs. 1 lakhs. Was there any expenses from this
which was borne by Mr. Vishal?

a. No, as the total expenditure on hospitalization was below the total health cover of
Rs. 15 lakhs
b. No, as the total expenditure on hospitalization was below the top-up cover of Rs. 10
lakhs
c. Yes, he has to bear Rs. 6 lakhs
d. Yes, he had to bear Rs. 3 lakhs

Q 11.2 To avoid the volatility in equites, Mr. Vishal plans to shift some part of the corpus
which he has accumulated for his children’s needs to short term debt fund. How much
corpus should he shift after 5 years to fund the two years of education? (Inflation for
education is 10% and returns from short term debt fund is 6.5%)
a. Rs. 75 lakhs
b. Rs. 53 lakhs
c. Rs. 71 lakhs
d. Rs. 68 lakhs

Q 11.3 What is the amount of life insurance that Mr. Vishal should take so that in the case of
his death, the house hold expenses and other goals are met? (Inflation as mentioned above
is at 6% and investment returns at 7.5%)

a. Rs. 1.47 crores

b. Rs. 2.11 crores
c. Rs. 0.80 crores
d. Rs. 1.38 crores

Q 11.4 – Mr. Vishal has decided to give importance to retirement planning. Calculate how
much will be the corpus required and what will be the monthly sum to be set aside to
achieve the corpus required after taking into account the contribution to provident fund.
(Inflation as mentioned above is 6%, investment return in retirement is 7.5% and long term
equity return is at 12%)
a. Corpus Required : Rs. 3.87 crores, Monthly sum : Rs. 36500
b. Corpus Required : Rs. 4.02 crores, Monthly sum : Rs. 41700
c. Corpus Required : Rs. 3.22 crores, Monthly sum : Rs. 33500
d. Corpus Required : Rs. 3.51 crores, Monthly sum : Rs. 34200
Q 11.5 If Mr. Vishal decides to use the bonus money to prepay a part of the home loan, then
what will be the change in the tenor?
a. 9 years
b. 11 years
c. 12.34 years
d. As per rules, the tenor cannot be changed, only the EMI can be reduced for adjusting
any prepayment of loan

Q 12. Commission received from business forms part of income from

a. Salary

b. Capital Gains

c. Business and profession

d. Other sources

Q 13. If the two persons are related by blood or adoption, wholly through females then
what is said for one person to another

a. Agnate

b. Cognate

c. Uterine Blood Relations

d. None of the above

Q14. If a mutual fund is held jointly, the tax benefits will accrue to

a. All the holders in equal proportion

b. All the holders as per the percentage entered in the application form
c. Only the first two holders
d. Only the first holder

Q15. From the given options, which one has the longest potential tenure for investors?

a. Index Funds
b. Index Futures
c. Index Option
d. Index Forwards
Q 16. From which date will the period of holding of equity shares, which have been
converted from preference shares, be considered?

a. From the date of conversion into equity shares

b. From the date of application for allotment of preference shares
c. From the date of acquisition of preference shares
d. From the date of application for conversion of preference shares into equity shares

Q17. Reinsurance is the practice whereby

a. Other insurance company will take continue with the same policy holder for the next
year under same terms
b. People insure their risks with many insurance firms
c. A person continues with the same general insurance company for the next year
d. Insurance companies transfer portions of their risk to other parties by some form of
agreement

Q 18. The management of a company selects a high-profile manager for steering their
company. Due to this an investor invests in the company. This is an example of

a. Loss Aversion Bias

b. Cognitive Bias
c. Stereo Typing Bias
d. Bounded Rationality Bias

Q. 19 According to Payment of Gratuity Act, last salary drawn' would mean

a. The Last Salary Drawn' would mean Basic salary Dearness allowance and Leave travel
allowance
b. The Last Salary Drawn' would mean Basic salary Dearness allowance and Commission
based on sales
c. The Last Salary Drawn' would mean Basic salary Dearness allowance and House rent
allowance
d. The Last Salary Drawn' would mean - Cost to the Company

Q. 20 As per the Hindu Succession Act, two persons are said to be in full blood relationship
when
a. when the father is same but mother is different
b. when atleast one parent is same
c. when both the parents are same
d. when the blood group is same with same DNA properties
Q. 21 _______ are at the core of behavioural finance.

A) Estimation Errors

B) Biases

C) Cognitive Errors

a. A and B
b. B and C
c. A and C
d. A, B and C

Q. 22 Volatility risk due to investments in equity is relatively higher in

a. NPS Tier 1
b. ELSS
c. Public Provident Fund
d. Bank Tax Savings Fixed Deposits

Q. 23 When does the document of "Will' come into effect?

a. The moment it is made and signed
b. The moment the maker of the Will dies
c. The moment the court allows to execute it
d. The moment it is registered with notary

Q. 24 Capital gains does not arise in which of these transactions?

a. Allotment of units of a Business Trust

b. Issue of shares of Special Purpose Vehicle (SPV) in exchange of units of Business
Trust
c. Direct allotment of shares of Special Purpose Vehicle (SPV)
d. None of the above

Q 25. Mr. Smart (60) has just retired from service. He is entitled to a pension of Rs.
4,80,000/- p.a. received yearly in advance. The pension adjusts partially with inflation to the
extent of 50%. Mr. Smart’s wife (Mrs. Smart-58) is entitled to the pension for her lifetime in
case of the demise of Mr. Smart before her. Nobody else is dependent on the couple.
The couple stays in their own home. Mr. Smart received Rs. 40 lakhs (after tax) as
retirement dues. Their current living expenses are equal to the pension amount. Mr. Smart’s
employer will continue to provide a family floater Mediclaim policy for both their life time
that is considered adequate for their needs. Inflation is to be assumed at 6% p.a. Life
expectancy is to be assumed to be 87 years for Mr. Smart and 85 years for Mrs. Smart.
The couple wants to make provision for expenses on social occasions that arise & leisure
travel expenditure to the tune of Rs. 1,00,000 p.a. (inflation 6% p.a.) apart from
compensating for the inflation adjustment shortfall in the pension income. Assume the
expenditure arises at the beginning of the each year. The couple seek your advise.

Q 25.1 If discounted @ 5% p.a. and assuming that the adjustment is fully required at the
beginning of the year, the inflation adjustment required is .
a) 80,18,710
b) 76,36,867
c) 1,91,39,462

Q 25.2 The amount required for compensating the difference required for inflation
adjustment based on a discounting rate of 5% is higher than the corpus of Rs. 40 lakhs
available with them. This means that:
a) The couple cannot meet their expenses requirement for the next 27 years, if the corpus
earns 5% p.a.
b) The couple can meet the expense requirements provided the corpus of Rs. 40 lakhs earn
@9.90% p.a.
c) The couple can meet the expense requirements provided the corpus of Rs. 40 lakhs earn
@9.22% p.a.
d) The couple can easily meet the expense requirements for the next 27 years with the
Corpus amount of Rs. 40,00,000

Q 25.3 The fixed income options available to the couple to earn highest rate of interest from
government schemes would be:

a) Senior Citizen savings Scheme 2019 upto a maximum investment of Rs. 15 lakhs
b) PM Vaya Vandana Yojana from LIC upto a maximum investment of Rs. 15 lakhs 476

c) Fixed deposit schemes available from Public sector banks for senior citizens without
any limit

Q. 26 Mr. Mahendra is having a financially satisfactory career and has well planned his
investments. Mr. Mahendra wants to safeguard his children against any losses etc. he
may suffer financially. He wants that their education and other needs are well looked
after.

He had made a will many years ago but now has forgotten about it. Some days ago his
father had died and had left no will behind. Due to this there were many complications
and this made Mr. Mahendra realise the importance of Will and Estate Planning.

One complication of his father dying intestate (ie. without a will) was that the
investments of his father in mutual funds etc. were released to the nominees and not to
the legal heir. Mr. Mahendra is the legal heir and is facing issues in getting the possession
of the inheritance.

Mr. Mahendra has a sister who wants some money to start a business. He has decided to
gift some amount to his sister but in a good tax efficient way.

Also Mr. Mahendra wants to make a donation in his will to some good charitable cause.

Q 26.1 By which way can Mr. Mahendra now write a new will?

a. He has to approach the court to cancel his old will as he has no records of that old
will
b. He can write a new will and mention in the new will that all the previous wills are
being revoked
c. He can put a codicil and describe in that on how he wants to distribute his assets
d. He can sue a succession certificate to distribute his assets to his legal heirs

Q 26.2 Identify the tax implication of Mr. Mahendra giving money to his sister as a gift?

a. As gifting between blood relatives is non-taxable, no tax will have to be paid by Mr.
Mahendra or his sister
b. Mr. Mahendra will have to pay regular tax as applicable to him on the amount given as
gift
c. Mr. Mahendra has to structure the gift as non-revocable to avoid the gift tax
d. There will be no tax on Mr. Mahendra but his sister will have to pay tax

Q 26.3 Mr. Mahendra wants to leave a bequest to charity in his will. Is this valid under the
Indian laws?
a. Its valid only if is making a bequest out of his own earnings and not inherited
property
b. Its valid only if Mr. Mahendra registers the will within 6 months of its execution
c. Its valid only if the bequest Mr. Mahendra does not exceed 7.5% of the estate
d. Its valid only if the bequest does not exceed 10% of the estate

Q 26.4 In which way can Mr. Mahendra make sure that the assets he has earmarked for his
children’s needs are received by his children and used effectively?

a. Mr. Mahendra should create a trust and transfer the assets to the trust. He should make
his children the beneficiaries
b. Mr. Mahendra should write will in favour of his children so that the assets are transferred
to them
c. Mr. Mahendra should add his children with guardian as joint holders in the assets
d. Any of the above
Q 26.5 Mr. Mahendra is the legal heir to his fathers investments. In which way can he get
the possession, as his father has died with a will?
a. As there is no will nor any joint holder, the nominees will legally get the possession
b. As the investments were given to the nominees, it is a legal discharge and Mr.
Mahendra cannot fight against it
c. Mr. Mahendra should obtain a succession certificate and claim the legal ownership
d. Mr. Mahendra should obtain a probate to establish his rights

Q. 27 Life expectancy directly affects which of the following features of the retirement goal?

a. Period in retirement
b. Remaining working years
c. Monthly expenses in retirement
d. Returns earned on the retirement corpus

Q. 28 Who cannot invest in Sovereign Gold Bonds?

a. An individual on behalf of a minor individual

b. A Company
c. A Private Trust
d. A Charitable Institute

Q. 29 Infotech Ltd. issued preference shares of face value Rs. 10 for Rs. 75. Mr. Sandeep (an
Indian resident) was allotted 2000 preference shares at Rs. 75 each. On the date of
allotment, the fair market value of this share was Rs. 65. What is the income taxable in the
hands of Infotech Ltd.
a. NIL
b. Rs 20,000
c. Rs 65.000
d. Rs 30,000

Q. 30 On 10th May, 2019, Vijay purchased 10,000 shares of XYZ Pvt. Ltd of face value Rs. 100
for Rs. 230 each. On, 12th August, 2021, the company announced a consolidation scheme of
two shares into one share. The Fair Market Value of the share as on 31st March 2021 was
Rs. 350 each Please calculate at which price the shares will be re-recorded in the books of
account of Vijay.

a. Rs 350
b. Rs 230
c. Rs 540
d. Rs 460
Q. 31 Unlisted Zero Coupon Bonds shall be considered as long-term capital asset if they are
held for months.

a. 6
b. 12
c. 18
d. 24

Q. 32 What does 'Laddering' of bonds mean?

a. Laddering means investing in bonds of various maturities which are spread over
years
b. Laddering means investing in different types of bonds
c. Laddering means investing in bonds of different credit rating
d. Laddering means investing in bonds which yields higher interest rates

Q. 33 What is the meaning of 'Ijma' in context to the succession laws under Muslim personal
law?
a. ljma means the law of the land
b. ljma means the consensus of the learned men on a particular subject matter
c. ljma means the opinion of the Imam
d. ljma means the local of Qazi

Q. 34 What percentage of shareholding should the sponsors have in a REIT?

a. The sponsors should a 25% shareholding for initial 8 years and 15% thereafter
b. The sponsors should a 25% shareholding for initial 3 years and 15% thereafter
c. The sponsors should a 10% shareholding for initial 5 years and 15% thereafter
d. The sponsors should a 50% shareholding for initial 3 years and 15% thereafter

Q. 35 Identify the true statement.

a. Top up policy threshold limit is applied for every claim; Super top up plan threshold
limit is applied on the total of all medical and hospitalization claims of the year
b. Top up policy threshold limit is applied on the total of all hospitalization claims for
the month; Super top up plan threshold limit is applied for every claim
c. Top up policy threshold limit is applied for every claim; Super top up plan threshold
limit is applied on the total of All Medical and hospitalization claims for the entire
d. family in the month Top up policy threshold limit is applied for every claim; Super
top up plan threshold limit is applied on the total of all hospitalization claims for the
year
Q. 36 Mukesh owns a small business. What is more important for him Succession planning
or Estate planning?
a. Succession planning is more important as it is about the society at large
b. Estate planning is more important as it is about his own property and family
c. Succession and Estate planning can be ignored as legal heirs will decide among
themselves
d. Both are equally important

Q. 37 In which way is the Employee Pension Scheme (EPS) funded?

a. The funding is as per the terms of employment of the employee and the employer
contributes according to these terms
b. The employer contributes 8 33% and the Government contributes 8.33%
c. From the periodic contribution of the employer and employee to the EPF 10 33% is
diverted to the EPS
d. 8.33% of the periodic contribution of the employer to the EPF is averted to EPS

Q. 38 Identify the difference between Succession planning and Estate planning.

a. There is no difference between estate planning and succession planning the terms
are interchangeable
b. Succession planning is for business while Estate planning is for own property
c. Estate planning is for business while Succession planning is for own property
d. The difference between Succession planning and Estate planning is dependent on
the way one is planning

For question no. 39 to 43: Answer in not more than 250 words each.

Q. 39 SGB vs Physical gold vs Gold ETF

Q. 40 Explain Super top-up health insurance with proper example

Q. 41 What are the tax rates applicable for Equity, Debt, Gold and International equity?

Q. 42 What are the options available to invest in NPS? Explain considering the investment
profile and asset allocation.

Q. 43 Does it make sense to invest in NPS to avail an annual deduction of Rs 50000?