Series 7 Exam Question 355: Answer and Explanation

Question: 355

Which of the following is TRUE of a durable power of attorney?

• A. It would be automatically revoked in the event that the grantor is declared incompetent.
• B. It gives power of attorney to someone else in the event that an individual becomes incompetent.
• C. It gives power of attorney to someone else in the event that an individual dies.
• D. Once in place, it may not be revoked by the grantor.

Correct Answer: B

Explanation:

B. A durable power of attorney gives power of attorney to someone else to handle financial affairs in the event that the grantor becomes incapacitated. A durable power of attorney is unlike a regular power of attorney, which terminates in the event the grantor becomes incapacitated.