Section C (4 Mark)
Read the senario and answer to the question.
Harish wants a monthly investment to achieve the goal of his children's higher education. For accumulation of fund you recommend Harish to invest in an investment vehicle which invests in the ratio of 20:80 in Debt and Equity. If Harish starts investing from 1st Dec 2010, what approximate amount should he set aside every month for each child to achieve the goal? Harish maintains separate investment accounts for Chirag and Vishesh and invests till they individually turn 21 years of age.

A. Rs. 8,400 and Rs. 3,760 respectively

B. Rs. 8,100 and Rs. 3,640 respectively

C. Rs. 9,540 and Rs. 4,240 respectively

D. Rs. 7,850 and Rs. 3,950 respectively

Section A (1 Mark)
Anurag has invested Rs. 10 lakh. in a pension fund that pays an interest rate of 12% p.a.
compounded quarterly. If Anurag wants to withdraw money after 25 years every month for next 20 years what amount can he withdraw.

A. 220034

B. 230972

C. 210034

D. 200021

Section B (2 Mark)
An assessee was allowed deduction of unrealized rent to the extent of Rs. 40,000 in the past although the total unrealized rent was Rs. 60,000. He is able to recover from the tenant Rs.45,000 during the previous year on account of such unrealized rent. He shall be liable to tax to the extent of:

A. Rs. 45,000

B. Nil

C. Rs. 25,000

D. Rs. 35,000

Section B (2 Mark)
Which of the following statements with respect to International Taxation Structure is/are correct?

A. I and II

B. III and IV

C. I, II and IV

D. I, II and III

Section C (4 Mark)
Read the senario and answer to the question.
Whether Mrs. Deepika as a resident individual can invest in units of Mutual Funds, Venture Funds, and Promissory notes without opening the bank account in foreign country?

A. Yes, she can

B. Yes, she can but opening a bank account in abroad for the same

C. Yes, she can invest without opening the bank account in foreign country for this purpose.

D. Yes, she can invest without opening the bank account in abroad for this purpose but taking a prior approval from the RBI

Section B (2 Mark)
What is the expected percentage price change for a bond with an effective duration of nine in response to an increase in yield of 30 basis points?

A. -2.70%

B. 2.70%

C. 0.30%

D. 3.00%

Section B (2 Mark)
You borrowed Rs8500, with the understanding that you are to make monthly payments over 36 months. Interest is charged at 7% compounded monthly. If you were to increase your payments by Rs20 per month, how much less time would it take you to pay back the loan?

A. 2.49 months

B. 2.81 months

C. 3.28 months

D. 1.55 months

Section B (2 Mark)
Assume that you purchased 100 shares of ABC in a self directed account and paid a commission on the transaction. Shortly following the purchase, you realize that you momentarily overlooked another 100 shares of ABC that you already owned in another account. Now, the redundant holdings are causing an imbalance in your overall portfolio.
What is your reaction to this situation, in case of Endowment Bias?

A. I

B. II

C. Both of the above

D. None of the above

Section A (1 Mark)
Which of the following is not a characteristic of defined benefit plan?

A. Benefit levels are guaranteed

B. These plans are easy to design and explain to employees

C. actuarial assumptions are necessary to determine actual contribution amounts

D. Employer is subject to a recurring annual funding obligation

Section A (1 Mark)
The first step of portfolio management is:

A. To assess market conditions.

B. To determine objectives, constraints and preferences.

C. To develop strategies and implement them.

D. To adjust the portfolio as necessary.

Section B (2 Mark)
Vikash has following portfolio with related details given below:



Calculate the portfolio beta?

A. 1.15

B. 1.65

C. 3.45

D. 1.35

Section B (2 Mark)
Ramesh living in Kolkata is a trustee for Brijesh living in Mumbai, Ramesh remits trust funds to Brijesh by bills drawn by a person of high creditworthiness in favor of the trustee as such and payable at Mumbai. The bills later got dishonored. Is Ramesh bound to make good the loss?

A. Yes

B. No