Abbas invested $35,000 in an equity-based segregated fund in his registered retirement savings plan (RRSP). The fund
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Question:
Abbas invested $35,000 in an equity-based segregated fund in his registered retirement savings plan (RRSP). The fund has a 75% maturity guarantee and a 100% death benefit guarantee. It is now one year later, and the fund has risen to $38,500. Which of the following statements about Abbas’ segregated fund investment is CORRECT?
a) If Abbas dies today, his beneficiary will receive a death benefit of $35,000.
b) If Abbas withdraws the entire amount today, his capital gain will be taxed as interest.
c) Abbas’ segregated fund is protected by the Canadian Investor Protection Fund (CIPF).
d) Abbas must declare a $3,500 capital gain for the current year.
Related Book For
Financial Management for Decision Makers
ISBN: 978-0138011604
2nd Canadian edition
Authors: Peter Atrill, Paul Hurley
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