Topic 2 - Economic Policy and Financial Regulation

Question 1

Who has the final say on regulatory matters?

A) The Bank of England
B) The FCA & PRA
C) The European Central Bank

Answer 1

C) The European Central Bank

Question 2

Does Monetary Policy Impact Macroeconomic or Microeconomic areas?

Answer 2

Macroeconomic

Question 3

How often in a year can the Bank Rate be changed?

A) 4
B) 8
C) 12

Answer 3

B) 8

Question 4

What is the difference between Regulations and Directives

Answer 4

Regulations - Binding & applicable to all member states

Directives - Set result in which each member state can decide how they want to achieve it (non binding)

Question 5

What are the 4 Key Macroeconomic Objectives

Answer 5

1. Price Stability (Low inflation)
2. Low Unemployment
3. Payment Equilibrium
4. Steady Economic Growth

Question 6

How is inflation measured?

A) GDP
B) SONIA
C) CPI

Answer 6

C) CPI (consumer price index)

Question 7

What is the Uk target % of inflation?

Answer 7

2%

Question 8

A recession is defined as:

A) 2 Quarters of Static GDP growth
B) 2 Quarters of Negative GDP growth

Answer 8

B) 2 Quarters of Negative GDP growth