Top-Quality FPQP® Exam Review Guide Questions and
Correct Solutions 2025/2026
What are the 2 components of total return for stocks and bonds - correct answer
capital appreciation and dividends/interest
Characteristic of bonds - correct answer callable bonds, coupon rate, credit ratings
How much debt a company uses is an example of what type of unsystematic risk -
correct answer financial risk
if you think interest rates are going to increase, then you would want a duration of
_____ years for your bond - correct answer not six
ETSs are _____ marketable when compared to mutual funds - correct 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 - correct answer
$942
A 4% coupon bond has 7 years left to maturity. If interest rates decrease to 3%, what is
the current value of the bond? assume coupon is paid semiannually - correct answer
1063
if you predict a rise in stock prices which beta would you prefer - correct answer not <1
A portfolio has a return of 7.2%. Risk-free rate is 1.2%, and a standard deviation of
11.8%. what is the sharpe ratio - correct answer 0.51
A client is seeking guidance in all areas of financial planning. Which of the following
most closely describes the type of financial planning the client wants? - correct answer
Comprehensive planning
,Personal financial planning - correct answer is a coordinated, continuous process.
Which of the following terms does NOT describe the financial planning process? -
correct answer Static
Which of the following is a characteristic of properly stated financial goals? - correct
answer Definite
A primary reason a financial goal must be measurable is so it can be - correct answer
monitored.
Which of the following financial goals is written correctly? - correct answer To
accumulate $40,000 in seven years for a down payment on a house
During which of the following steps in the financial planning process is the current yield
from already-invested assets first identified? - correct answer Understanding the
client's personal and financial circumstances
Asset categories that are appropriate for the client are determined during which of the
following steps of the financial planning process? - correct answer Developing the
financial planning recommendations
During which of the following steps of the financial planning process is the performance
of a client's investments reviewed periodically? - correct answer Monitoring progress
and updating
Potential problems that might interfere with clients achieving their objectives are
identified in which of the following steps in the financial planning process? - correct
answer Analyzing the client's current course of action and potential alternate course(s)
of action
Which of the following would NOT be considered quantitative data? - correct answer
Health status
,Which of the following is something a financial planner would want to know when
creating a financial plan?
Insurance needs
Retirement income objectives
Acceptable investment strategies
Liquid assets available for emergencies - correct answer I, II, III, and IV
Which of the seven steps of the financial planning process follows the development of
the financial planning recommendations? - correct answer Presenting the financial
planning recommendations
Which of the following is the best description of a fiduciary? - correct answer A
fiduciary always puts the best interests of the client first.
It is generally recommended by planners that an emergency fund be established. Which
of the following guidelines is recommended? - correct answer Three to six months of
living expenses in liquid investments
Which of the following statements is CORRECT? - correct answer Data gathering for a
financial planning engagement includes both quantitative and qualitative data.
Which of the following is a well-written goal? - correct answer To accumulate
$500,000, by starting to save today, for retirement in 20 years
Limited resources is the main reason for - correct answer prioritizing goals.
Which of the following is NOT a requirement of a properly stated goal? - correct
answer Justification
All of the following are Standards of Professional Conduct in the FPQP™ Code of
Ethics except - correct answer experience
, In examining retirement plan issues, which of the following should be considered?
Retirement income objective
General investment constraints
Maximum allowable contributions to qualified retirement plans
Matching and vesting provisions of employer-sponsored retirement plans - correct
answer I, II, III, and IV
All of the following are requirements for CFP® certification except - correct answer
10,000 hours of professional experience related to the financial planning process.
Which of the following Financial Paraplanner Qualified Professional™ Standards of
Professional Conduct is matched with its correct definition? - correct answer
Confidentiality—keep client information confidential, disclosing only when authorized or
compelled by law
The FPQP™ Code of Ethics requires compliance with all of the following components
except - correct answer observance of state statutes.
Which of the following are best practices when approaching financial planning?
Reevaluate your plan periodically.
Don't confuse financial planning with investing.
Don't expect unrealistic returns on investments.
Focus on retirement planning or tax planning. - correct answer I, II, and III
Which of the following is especially important when dealing with estate planning for a
client? - correct answer Titling of assets and property
Which of the following often occurs when developing financial planning
recommendations? - correct answer Consultation by the financial planner with other
professionals
Correct Solutions 2025/2026
What are the 2 components of total return for stocks and bonds - correct answer
capital appreciation and dividends/interest
Characteristic of bonds - correct answer callable bonds, coupon rate, credit ratings
How much debt a company uses is an example of what type of unsystematic risk -
correct answer financial risk
if you think interest rates are going to increase, then you would want a duration of
_____ years for your bond - correct answer not six
ETSs are _____ marketable when compared to mutual funds - correct 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 - correct answer
$942
A 4% coupon bond has 7 years left to maturity. If interest rates decrease to 3%, what is
the current value of the bond? assume coupon is paid semiannually - correct answer
1063
if you predict a rise in stock prices which beta would you prefer - correct answer not <1
A portfolio has a return of 7.2%. Risk-free rate is 1.2%, and a standard deviation of
11.8%. what is the sharpe ratio - correct answer 0.51
A client is seeking guidance in all areas of financial planning. Which of the following
most closely describes the type of financial planning the client wants? - correct answer
Comprehensive planning
,Personal financial planning - correct answer is a coordinated, continuous process.
Which of the following terms does NOT describe the financial planning process? -
correct answer Static
Which of the following is a characteristic of properly stated financial goals? - correct
answer Definite
A primary reason a financial goal must be measurable is so it can be - correct answer
monitored.
Which of the following financial goals is written correctly? - correct answer To
accumulate $40,000 in seven years for a down payment on a house
During which of the following steps in the financial planning process is the current yield
from already-invested assets first identified? - correct answer Understanding the
client's personal and financial circumstances
Asset categories that are appropriate for the client are determined during which of the
following steps of the financial planning process? - correct answer Developing the
financial planning recommendations
During which of the following steps of the financial planning process is the performance
of a client's investments reviewed periodically? - correct answer Monitoring progress
and updating
Potential problems that might interfere with clients achieving their objectives are
identified in which of the following steps in the financial planning process? - correct
answer Analyzing the client's current course of action and potential alternate course(s)
of action
Which of the following would NOT be considered quantitative data? - correct answer
Health status
,Which of the following is something a financial planner would want to know when
creating a financial plan?
Insurance needs
Retirement income objectives
Acceptable investment strategies
Liquid assets available for emergencies - correct answer I, II, III, and IV
Which of the seven steps of the financial planning process follows the development of
the financial planning recommendations? - correct answer Presenting the financial
planning recommendations
Which of the following is the best description of a fiduciary? - correct answer A
fiduciary always puts the best interests of the client first.
It is generally recommended by planners that an emergency fund be established. Which
of the following guidelines is recommended? - correct answer Three to six months of
living expenses in liquid investments
Which of the following statements is CORRECT? - correct answer Data gathering for a
financial planning engagement includes both quantitative and qualitative data.
Which of the following is a well-written goal? - correct answer To accumulate
$500,000, by starting to save today, for retirement in 20 years
Limited resources is the main reason for - correct answer prioritizing goals.
Which of the following is NOT a requirement of a properly stated goal? - correct
answer Justification
All of the following are Standards of Professional Conduct in the FPQP™ Code of
Ethics except - correct answer experience
, In examining retirement plan issues, which of the following should be considered?
Retirement income objective
General investment constraints
Maximum allowable contributions to qualified retirement plans
Matching and vesting provisions of employer-sponsored retirement plans - correct
answer I, II, III, and IV
All of the following are requirements for CFP® certification except - correct answer
10,000 hours of professional experience related to the financial planning process.
Which of the following Financial Paraplanner Qualified Professional™ Standards of
Professional Conduct is matched with its correct definition? - correct answer
Confidentiality—keep client information confidential, disclosing only when authorized or
compelled by law
The FPQP™ Code of Ethics requires compliance with all of the following components
except - correct answer observance of state statutes.
Which of the following are best practices when approaching financial planning?
Reevaluate your plan periodically.
Don't confuse financial planning with investing.
Don't expect unrealistic returns on investments.
Focus on retirement planning or tax planning. - correct answer I, II, and III
Which of the following is especially important when dealing with estate planning for a
client? - correct answer Titling of assets and property
Which of the following often occurs when developing financial planning
recommendations? - correct answer Consultation by the financial planner with other
professionals
