For finance professionals · Quiz 1 of 3
Test your CERTIFIED FINANCIAL PLANNER® Readiness — Quiz 1
25 exam-style questions for finance professionals — 15 standalone and 10 case-based — covering mutual funds, retirement planning, behavioural finance and Indian and cross-border tax.
- 25 questions
- 10 case-based
- 60-minute timer
- Full answer sheet
What this quiz covers
Direct vs regular plans, duration, the Sharpe ratio, equity and debt fund taxation, behavioural biases and old vs new regime — plus cases on a young family and a couple about to retire.
Why it matters
It mirrors the integrated thinking the CFP® exam rewards: moving from a concept to a calculation to a recommendation for a real client, under time pressure.
Before you start
- One question at a time. Move freely with Next, Previous or the question palette.
- Mark for review any question you want to revisit before submitting.
- The timer runs for 60 minutes and the quiz submits itself when it reaches zero — just like exam day.
- Questions 16–25 are based on 2 case studies. The case facts stay on screen while you answer.
- When you submit, you’ll get your score, a topic-by-topic breakdown and a full answer sheet with explanations.
- Keyboard: A–D to answer, ← → to move, M to mark.
Assumptions: Unless stated otherwise, assume resident individuals and FY 2025-26 income-tax rules (the year before the Income-tax Act, 2025 took effect). Ignore surcharge unless mentioned. Round intermediate figures sensibly.
An independent practice quiz from CFPInstitutes.com — not an FPSB India exam and not a predictor of your result. FPSB India does not publish a pass mark.
Under SEBI’s scheme categorisation norms, a “large cap” company is one that ranks:
A debt fund has a modified duration of 4 years. If market yields rise by 1 percentage point, the fund’s NAV is likely to:
An investor bought units of a pure debt mutual fund in June 2023 and redeems them in FY 2025-26 at a gain. How is the gain taxed?
Fund X returned 14% with a standard deviation of 20%. Fund Y returned 12% with a standard deviation of 10%. The risk-free rate is 7%. Based on the Sharpe ratio:
Using the Rule of 72, approximately how long will it take for a retirement corpus to double at 8% a year?
A resident Indian receives a dividend from shares of a US company. The US withholds tax under the India–US tax treaty. Which statement is correct?
A client refuses to sell a stock until it gets back to ₹850 — the price he paid — although his own analysis says it is now worth ₹600. This is mainly an example of:
Investors who sell winners too early and hold losers too long are displaying:
A client happily spends a ₹2 lakh bonus on a holiday, but would never withdraw ₹2 lakh from savings for the same trip. This illustrates:
In FY 2025-26, a resident sells listed equity shares held for 20 months and makes a long-term gain of ₹3,25,000. She has no other capital gains. Her tax on this gain (before cess) is:
A client opting for the new tax regime asks whether she should invest ₹1.5 lakh in ELSS “to save tax”. The best response is:
Interest earned on an NRE fixed deposit by a person who is a non-resident under FEMA is:
A client says, “IRDAI caps agent commission product by product, so the agent has no reason to push one plan over another.” What should the planner point out?
Under FPSB’s financial planning process, what comes first?
Case A Rahul Sharma, 35: protection, goals and taxNew case
Rahul (35) is a salaried IT manager in Pune earning a gross salary of ₹24,00,000 a year. His wife Meera (32) is a homemaker and their son Vihaan is 3. Household living expenses are ₹9,00,000 a year (₹75,000 a month), excluding a home-loan EMI of ₹35,000 a month (outstanding principal ₹40,00,000; annual interest about ₹2,80,000; self-occupied house).
Assets: savings account and FDs ₹3,00,000; equity mutual funds ₹8,00,000; EPF balance ₹6,00,000. Insurance: group term cover of ₹20,00,000 from his employer and a ₹5,00,000 family-floater health policy, also from the employer. He has no personal life or health cover.
Goal: Vihaan’s higher education, costing ₹25,00,000 in today’s money, needed in 15 years. Education inflation is expected to be 8% a year. Rahul invests ₹1,50,000 a year in tax-saving products and pays ₹25,000 a year for a parents’ health policy.
What is the most appropriate emergency fund for Rahul’s household, based on six months of essential outflows?
Case A Rahul Sharma, 35: protection, goals and tax
Rahul (35) is a salaried IT manager in Pune earning a gross salary of ₹24,00,000 a year. His wife Meera (32) is a homemaker and their son Vihaan is 3. Household living expenses are ₹9,00,000 a year (₹75,000 a month), excluding a home-loan EMI of ₹35,000 a month (outstanding principal ₹40,00,000; annual interest about ₹2,80,000; self-occupied house).
Assets: savings account and FDs ₹3,00,000; equity mutual funds ₹8,00,000; EPF balance ₹6,00,000. Insurance: group term cover of ₹20,00,000 from his employer and a ₹5,00,000 family-floater health policy, also from the employer. He has no personal life or health cover.
Goal: Vihaan’s higher education, costing ₹25,00,000 in today’s money, needed in 15 years. Education inflation is expected to be 8% a year. Rahul invests ₹1,50,000 a year in tax-saving products and pays ₹25,000 a year for a parents’ health policy.
Which is the most appropriate observation about Rahul’s life insurance?
Case A Rahul Sharma, 35: protection, goals and tax
Rahul (35) is a salaried IT manager in Pune earning a gross salary of ₹24,00,000 a year. His wife Meera (32) is a homemaker and their son Vihaan is 3. Household living expenses are ₹9,00,000 a year (₹75,000 a month), excluding a home-loan EMI of ₹35,000 a month (outstanding principal ₹40,00,000; annual interest about ₹2,80,000; self-occupied house).
Assets: savings account and FDs ₹3,00,000; equity mutual funds ₹8,00,000; EPF balance ₹6,00,000. Insurance: group term cover of ₹20,00,000 from his employer and a ₹5,00,000 family-floater health policy, also from the employer. He has no personal life or health cover.
Goal: Vihaan’s higher education, costing ₹25,00,000 in today’s money, needed in 15 years. Education inflation is expected to be 8% a year. Rahul invests ₹1,50,000 a year in tax-saving products and pays ₹25,000 a year for a parents’ health policy.
What will Vihaan’s education cost in 15 years, in future rupees?
Case A Rahul Sharma, 35: protection, goals and tax
Rahul (35) is a salaried IT manager in Pune earning a gross salary of ₹24,00,000 a year. His wife Meera (32) is a homemaker and their son Vihaan is 3. Household living expenses are ₹9,00,000 a year (₹75,000 a month), excluding a home-loan EMI of ₹35,000 a month (outstanding principal ₹40,00,000; annual interest about ₹2,80,000; self-occupied house).
Assets: savings account and FDs ₹3,00,000; equity mutual funds ₹8,00,000; EPF balance ₹6,00,000. Insurance: group term cover of ₹20,00,000 from his employer and a ₹5,00,000 family-floater health policy, also from the employer. He has no personal life or health cover.
Goal: Vihaan’s higher education, costing ₹25,00,000 in today’s money, needed in 15 years. Education inflation is expected to be 8% a year. Rahul invests ₹1,50,000 a year in tax-saving products and pays ₹25,000 a year for a parents’ health policy.
Which investment approach best suits the education goal?
Case A Rahul Sharma, 35: protection, goals and tax
Rahul (35) is a salaried IT manager in Pune earning a gross salary of ₹24,00,000 a year. His wife Meera (32) is a homemaker and their son Vihaan is 3. Household living expenses are ₹9,00,000 a year (₹75,000 a month), excluding a home-loan EMI of ₹35,000 a month (outstanding principal ₹40,00,000; annual interest about ₹2,80,000; self-occupied house).
Assets: savings account and FDs ₹3,00,000; equity mutual funds ₹8,00,000; EPF balance ₹6,00,000. Insurance: group term cover of ₹20,00,000 from his employer and a ₹5,00,000 family-floater health policy, also from the employer. He has no personal life or health cover.
Goal: Vihaan’s higher education, costing ₹25,00,000 in today’s money, needed in 15 years. Education inflation is expected to be 8% a year. Rahul invests ₹1,50,000 a year in tax-saving products and pays ₹25,000 a year for a parents’ health policy.
For FY 2025-26, which regime minimises Rahul’s tax, and what is his tax (including 4% cess) under that regime? Under the old regime, assume he claims the standard deduction, ₹1,50,000 of investment deductions, ₹2,00,000 home-loan interest and ₹25,000 for the parents’ health premium.
Case B The Iyers: retirement in two yearsNew case
Mr Venkat Iyer (58) and Mrs Lakshmi Iyer (56) live in Chennai. Venkat retires at 60. Their current household expenses are ₹60,000 a month and they expect the same lifestyle in retirement. Assume inflation of 6% a year, a post-retirement portfolio return of 7% a year, and that they need income until Lakshmi is 85 — a 25-year retirement starting at Venkat’s 60th birthday. Expenses are withdrawn at the start of each year.
At retirement they expect to have ₹1.5 crore in EPF, PPF, debt funds and equity funds combined. Their house is fully paid and they do not want to sell it. Venkat is anxious after a friend’s portfolio fell 25% in the year he retired.
What will the Iyers’ monthly expenses be at Venkat’s retirement, two years from now?
Case B The Iyers: retirement in two years
Mr Venkat Iyer (58) and Mrs Lakshmi Iyer (56) live in Chennai. Venkat retires at 60. Their current household expenses are ₹60,000 a month and they expect the same lifestyle in retirement. Assume inflation of 6% a year, a post-retirement portfolio return of 7% a year, and that they need income until Lakshmi is 85 — a 25-year retirement starting at Venkat’s 60th birthday. Expenses are withdrawn at the start of each year.
At retirement they expect to have ₹1.5 crore in EPF, PPF, debt funds and equity funds combined. Their house is fully paid and they do not want to sell it. Venkat is anxious after a friend’s portfolio fell 25% in the year he retired.
What inflation-adjusted (real) rate of return should be used to value their retirement income need?
Case B The Iyers: retirement in two years
Mr Venkat Iyer (58) and Mrs Lakshmi Iyer (56) live in Chennai. Venkat retires at 60. Their current household expenses are ₹60,000 a month and they expect the same lifestyle in retirement. Assume inflation of 6% a year, a post-retirement portfolio return of 7% a year, and that they need income until Lakshmi is 85 — a 25-year retirement starting at Venkat’s 60th birthday. Expenses are withdrawn at the start of each year.
At retirement they expect to have ₹1.5 crore in EPF, PPF, debt funds and equity funds combined. Their house is fully paid and they do not want to sell it. Venkat is anxious after a friend’s portfolio fell 25% in the year he retired.
Approximately what corpus do the Iyers need at retirement to fund 25 years of inflation-adjusted expenses, withdrawn at the start of each year?
Case B The Iyers: retirement in two years
Mr Venkat Iyer (58) and Mrs Lakshmi Iyer (56) live in Chennai. Venkat retires at 60. Their current household expenses are ₹60,000 a month and they expect the same lifestyle in retirement. Assume inflation of 6% a year, a post-retirement portfolio return of 7% a year, and that they need income until Lakshmi is 85 — a 25-year retirement starting at Venkat’s 60th birthday. Expenses are withdrawn at the start of each year.
At retirement they expect to have ₹1.5 crore in EPF, PPF, debt funds and equity funds combined. Their house is fully paid and they do not want to sell it. Venkat is anxious after a friend’s portfolio fell 25% in the year he retired.
Venkat’s main fear is a market fall early in retirement. Which risk is this, and what is a common way to manage it?
Case B The Iyers: retirement in two years
Mr Venkat Iyer (58) and Mrs Lakshmi Iyer (56) live in Chennai. Venkat retires at 60. Their current household expenses are ₹60,000 a month and they expect the same lifestyle in retirement. Assume inflation of 6% a year, a post-retirement portfolio return of 7% a year, and that they need income until Lakshmi is 85 — a 25-year retirement starting at Venkat’s 60th birthday. Expenses are withdrawn at the start of each year.
At retirement they expect to have ₹1.5 crore in EPF, PPF, debt funds and equity funds combined. Their house is fully paid and they do not want to sell it. Venkat is anxious after a friend’s portfolio fell 25% in the year he retired.
Given the shortfall, which recommendation is MOST appropriate?
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