Correct Answer: Discussing an RESP for a child
Why this is correct: The caller says he has an RESP for his daughter and is worried about contributions. The whole call is about RESP limits and grants. This clearly matches discussing an RESP for a child.
Tips: For main topic questions, focus on the first and repeated ideas.
Why the other options are wrong:
- A: They never talk about a house or borrowing money. No mortgage words appear in the call.
- B: They do not mention daily banking or chequing accounts. The focus stays on education savings.
- D: They do not talk about applying for a loan. The child is only five years old.
Correct Answer: Because contribution limits apply across all RESPs for one child
Why this is correct: The advisor asks about other family members' RESPs. He explains all RESPs for one child share the same limits. This explains why the question matters.
Tips: When asked why, listen for the explanation right after.
Why the other options are wrong:
- B: No one talks about grandparents' income. Income reporting is not mentioned.
- C: The advisor does not say only one RESP is allowed. He says limits are shared.
- D: He does not say older RESPs close automatically. That idea is never stated.
Correct Answer: Facing penalties for contributing too much
Why this is correct: At the start, the caller says he worries he may have overcontributed. He also says he does not want penalties. This shows his main worry.
Tips: Early worries often show the main concern.
Why the other options are wrong:
- A: He does not mention losing access to the account. The account stays open.
- B: Bank service fees are never discussed. No costs like that are mentioned.
- C: They do not talk about investment choices. The focus is on limits.
Correct Answer: Only a lifetime limit applies
Why this is correct: The advisor clearly says there is no annual limit. He then states there is a lifetime limit of fifty thousand dollars. This directly answers the question.
Tips: Trust direct rule statements from the advisor.
Why the other options are wrong:
- A: He clearly says there is no annual contribution limit. So this is wrong.
- C: He does not connect limits to the child's age. Age is not used for limits.
- D: Provinces are never mentioned. Limits are not provincial here.
Correct Answer: Because the annual grant maximum is capped
Why this is correct: The advisor says the grant matches twenty percent up to five hundred dollars per year. Putting in more money does not increase the grant that year. This shows the annual cap.
Tips: Match numbers to reasons in the question.
Why the other options are wrong:
- A: Grants are discussed now, not only at withdrawal. This is incorrect.
- B: The account age is never mentioned. That is not the reason.
- D: No bank name or bank rule is mentioned. This is not about TD Bank.
Correct Answer: It can be used in future years
Why this is correct: The advisor explains extra contributions can count toward future grant room. This means unused grant room is not lost. It can be used later.
Tips: Future meaning often answers what happens later.
Why the other options are wrong:
- B: He does not say it disappears. He says it can be used later.
- C: There is no talk about transferring to another child.
- D: No special application is mentioned at all.
Correct Answer: He will pause contributions until next year
Why this is correct: The caller says he will stop for the rest of this year. He plans to review in January. This means he will pause contributions until next year.
Tips: Final answers often come near the end.
Why the other options are wrong:
- A: He never says he will close the RESP. The account stays open.
- B: He does not plan to increase contributions next month.
- C: He does not mention changing banks.
Correct Answer: It helps balance grants and cash flow
Why this is correct: The advisor agrees after discussing cash flow and high daycare costs. He says reducing contributions could balance things. This explains why the plan makes sense.
Tips: Agreement often follows a clear reason.
Why the other options are wrong:
- A: Bank profits are never mentioned. This is not the goal.
- C: They do not talk about reporting rules here.
- D: Higher returns are not discussed at all.
