1|Page
CRPC PRACTICE EXAM AND STUDYGUIDE LATEST
2025/ 2026 ACTUAL EXAM WITH COMPLETE
QUESTIONS AND CORRECT DETAILED ANSWERS
WITH EXPLANATIONS (100% VERIFIED ANSWERS)
|ALREADY GRADED A+| ||PROFESSOR VERIFIED||
||LATEST EXAM!!!||
Which of the following are correct statements about the
capital utilization strategy? - Answer-I. It produces an
annual retirement income over a finite number of years.
II. Assuming the yield remains the same, the larger the
retirement income that is paid, the shorter the number of
years over which it will be paid.
III. When the capital utilization approach is used, the
planner must be careful in making assumptions about the
life expectancy of the client.
IV. The effect of taxes on retirement savings and
distributions should be considered when the before-tax
approach is used to calculate the future value of
retirement assets.
Which one of the following is not a key element of an
investment policy? - Answer-A) a provision for periodic
review
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B) the acceptable risk tolerance level
C) a target asset allocation
D) names of specific stocks to be in the portfolio
--D
The key elements in an investment policy are a clear
statement of the client's goal, suitable investment vehicles
and strategies, the acceptable risk tolerance level for the
client, asset allocation guidelines, and a provision for
periodic review. One way to remember the essential
elements of an investment policy is the acronym "GRASP"
(Goals, Risk, Asset Allocation, Strategies/Suitable
Investment-meaning the investment categories that may
or may not be used-and Periodic Review). Specific
investments would be determined after the investment
policy is created.
Which one of the following is a characteristic of Treasury
inflation-protected securities (TIPS)? - Answer-A) They are
sold at a discount.
B) The increase in principal is taxable each year.
C) Their returns are tied to the producer price index.
D) They are issued with maturities up to 40 years.
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Your client owns a bond fund with a duration of 6.5. If
interest rates increase 1.5%, what is the expected change
in price for this fund? - Answer-A) 6.5% decrease
B) 9.75% increase
C) 9.75% decrease
D) 6.5% increase
--C
1.5% -6.5 = -9.75%. Recall that duration needs to have a
negative sign in order to represent the inverse relationship
between bond prices and interest rates. In this case, an
increase in rates means the bonds or bond funds will fall in
price. Therefore, this fund will decrease in price about
9.75%. Also, you can remember that bond prices move
opposite to interest rates. An increase in interest rates
means the price of bonds will go down.
The process of rebalancing is a key factor in - Answer-
Strategic asset allocation.
Strategic asset allocation involves obtaining the best asset
mix for a client over a long period. For example, this might
be 60% stocks and 40% bonds. When these percentages
change due to market movements, this strategic asset
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allocation requires the portfolio to be rebalanced back to
the target mix, in this case 60/40 stocks/bonds.
What does Jensen's alpha tell you? - Answer-the
percentage a manager over- or underperformed based on
the amount of risk taken
The percentage of return that can be attributed to
systematic risk is referred to as the - Answer-coefficient of
determination (R2).
Which of the following are not used in technical analysis? -
Answer-A) graphs
B) financial statement ratios
C) moving averages
D) supply and demand of stocks
--B
Moving averages, graphs, and statistics regarding the
supply and demand of stocks are used by technicians.
CRPC PRACTICE EXAM AND STUDYGUIDE LATEST
2025/ 2026 ACTUAL EXAM WITH COMPLETE
QUESTIONS AND CORRECT DETAILED ANSWERS
WITH EXPLANATIONS (100% VERIFIED ANSWERS)
|ALREADY GRADED A+| ||PROFESSOR VERIFIED||
||LATEST EXAM!!!||
Which of the following are correct statements about the
capital utilization strategy? - Answer-I. It produces an
annual retirement income over a finite number of years.
II. Assuming the yield remains the same, the larger the
retirement income that is paid, the shorter the number of
years over which it will be paid.
III. When the capital utilization approach is used, the
planner must be careful in making assumptions about the
life expectancy of the client.
IV. The effect of taxes on retirement savings and
distributions should be considered when the before-tax
approach is used to calculate the future value of
retirement assets.
Which one of the following is not a key element of an
investment policy? - Answer-A) a provision for periodic
review
,2|Page
B) the acceptable risk tolerance level
C) a target asset allocation
D) names of specific stocks to be in the portfolio
--D
The key elements in an investment policy are a clear
statement of the client's goal, suitable investment vehicles
and strategies, the acceptable risk tolerance level for the
client, asset allocation guidelines, and a provision for
periodic review. One way to remember the essential
elements of an investment policy is the acronym "GRASP"
(Goals, Risk, Asset Allocation, Strategies/Suitable
Investment-meaning the investment categories that may
or may not be used-and Periodic Review). Specific
investments would be determined after the investment
policy is created.
Which one of the following is a characteristic of Treasury
inflation-protected securities (TIPS)? - Answer-A) They are
sold at a discount.
B) The increase in principal is taxable each year.
C) Their returns are tied to the producer price index.
D) They are issued with maturities up to 40 years.
,3|Page
Your client owns a bond fund with a duration of 6.5. If
interest rates increase 1.5%, what is the expected change
in price for this fund? - Answer-A) 6.5% decrease
B) 9.75% increase
C) 9.75% decrease
D) 6.5% increase
--C
1.5% -6.5 = -9.75%. Recall that duration needs to have a
negative sign in order to represent the inverse relationship
between bond prices and interest rates. In this case, an
increase in rates means the bonds or bond funds will fall in
price. Therefore, this fund will decrease in price about
9.75%. Also, you can remember that bond prices move
opposite to interest rates. An increase in interest rates
means the price of bonds will go down.
The process of rebalancing is a key factor in - Answer-
Strategic asset allocation.
Strategic asset allocation involves obtaining the best asset
mix for a client over a long period. For example, this might
be 60% stocks and 40% bonds. When these percentages
change due to market movements, this strategic asset
, 4|Page
allocation requires the portfolio to be rebalanced back to
the target mix, in this case 60/40 stocks/bonds.
What does Jensen's alpha tell you? - Answer-the
percentage a manager over- or underperformed based on
the amount of risk taken
The percentage of return that can be attributed to
systematic risk is referred to as the - Answer-coefficient of
determination (R2).
Which of the following are not used in technical analysis? -
Answer-A) graphs
B) financial statement ratios
C) moving averages
D) supply and demand of stocks
--B
Moving averages, graphs, and statistics regarding the
supply and demand of stocks are used by technicians.
