Topic 5

Question 1

What is bank rate

Answer 1

the interest rate that the bank of England uses when it lends money to other banks

Question 2

what do financial service providers do with bank rate

Answer 2

take account of bank rate when they decide how to set interest rate on their own products

Question 3

what is the banking act of 2009

Answer 3

it provided a set of tools to allow the regulatory authorities to resolve a bank or building society that is in financial difficulty in an orderly way

Question 4

what was the banking act of 2009 set to reducce

Answer 4

the impact of a bank failure on financial stability and bank customers

Question 5

what is consumer protection

Answer 5

designing products and services with customers’ need in mind, rather than making maximum profits priority.

Question 6

what does consumer protection involve

Answer 6

ensuring that customers are not sold products that unsuitable for them, and that they are treated fairly

Question 7

what is corporate social responsibility

Answer 7

any action or project in which a company goes beyond the interests of its shareholders and senior management in order to benefit other stakeholder groups, normally with either a social or environmental purpose

Question 8

what is CSR also known as

Answer 8

citizenship or sustainable responsible business

Question 9

what is digital exclusion

Answer 9

an aspect of financial exclusion, the inability to take part in the computer based society

Question 10

what is financial exclusion

Answer 10

the inability to get access to the most basic financial services and products

Question 11

what is the banking reform act of 2013

Answer 11

legislation that introduced retail ring-fencing for banks and the cap on payday lenders

Question 12

what is the financial services act of 2010

Answer 12

legislation that focuses on the need for banks to have a plan in place to deal with situations where they get into financial difficulty

Question 13

what is the financial services act of 2012

Answer 13

the main act of parliament governing the regulation of the financial service industry

Question 14

what does ftse stand for

Answer 14

financial time stock exchange index

Question 15

what is the ftse 100

Answer 15

an index of the share price of the 100 companies with the highest market capitalisation listed on the london stock exchange

Question 16

what is the ftse 100 also known as

Answer 16

the footsie

Question 17

what is general data protection regulation

Answer 17

European union legislation, in the uk its provisions supersede those of the data protection act of 1998 the creation of the data protection act

Question 18

when was the general data protection act implemented

Answer 18

25th may 2018

Question 19

what is the help to buy scheme

Answer 19

a government backed initiative set up to help home hunters purchase a property with as little 5% deposit

Question 20

what is loan forbearance

Answer 20

when a lender does not seek to repossess a property as soon as the borrower misses a few monthly payments, instead allowing the customer to stop paying or make a reduced payment for a set period

Question 21

what is money laudnering

Answer 21

the process of making dirty money clean, making it look to be acquired legitimately

Question 22

what is mortgage equity withdrawal

Answer 22

additional borrowing based on the difference between the value of the house and the outstanding mortgage

Question 23

what is the national employment savings trust

Answer 23

a pension scheme run by a public organisation, which aims to ensure that the majority of workers are enrolled in an occupational pension

Question 24

what is pestle analysis

Answer 24

a tool used to analyse how six key areas in the external environment might affect individual and corporate financial decisions

Question 25

what is profit margin

Answer 25

the amount by which income from sales exceeds costs

Question 26

what is social inclusion

Answer 26

ensuring all individuals and groups in society can benefit from certain rights and entitlements

Question 27

What area of PESTLE analyses new delivery methods and new products

Answer 27

technological

Question 28

Individuals are directly exposed to movements in the stock market if they have invested in what

Answer 28

shares

Question 29

Prior to the financial crisis of 2007, the UK attracted international banks because it was seen to have a…

Answer 29

light touch approach to regulation

Question 30

what is the role of the information commissioner

Answer 30

enforce the data protection act/UK general data protection regulation

Question 31

what is a factor that could make a financial services product unsuitable for a particular client

Answer 31

age

Question 32

who can complying with regulation be a barrier to

Answer 32

new providers entering the banking industry

Question 33

what do standards of lending practice form

Answer 33

a voluntary banking code that covers the sale of credit excluding mortgages

Question 34

what is the relationship between interest rates and business investment

Answer 34

when interest rates fall, business investment rises

Question 35

what does it mean to lend responsibly

Answer 35

banks must ensure borrowers can show that their income is high enough to make mortgage payments as well as other bills

Question 36

what is a feature of a social programme

Answer 36

must be balanced against a provider’s obligation to earn a good return for its shareholders or members