Certified Trust and Financial Advisor (CTFA) CTFA Exam Questions

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Question #1 (Topic: Demo Questions)

What is the primary purpose of a trust?

To eliminate all taxes

To hold and manage assets for the benefit of designated beneficiaries

To guarantee investment returns

To avoid all legal obligations

Correct Answer: B

Question #2 (Topic: Demo Questions)

Who is responsible for managing trust assets according to the trust agreement?

Beneficiary

Settlor

Trustee

Creditor

Correct Answer: C

Question #3 (Topic: Demo Questions)

What is a revocable trust?

A trust that cannot be changed

A trust that the grantor can generally amend or terminate during their lifetime, subject to its terms and applicable law

A trust that automatically expires after one year

A trust created only for charitable organizations

Correct Answer: B

Question #4 (Topic: Demo Questions)

What does the fiduciary duty of loyalty require?

Prioritizing the trustee's personal interests

Acting in the interests of the beneficiaries

Avoiding all investment decisions

Distributing all trust assets immediately

Correct Answer: B

Question #5 (Topic: Demo Questions)

What is the primary purpose of a trust accounting?

To calculate employee salaries

To document trust income, expenses, assets, and distributions

To determine bank marketing expenses

To eliminate investment risk

Correct Answer: B

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