Unit 1 Flashcards
A2 Goverment Saving
- Melissa is looking for a savings vehicle that produces a predictable level of income which is paid at regular intervals. She can best achieve this by investing in?
A. a Collective Saving Scheme
B. UK Shares
C. Derivetives
D. UK Goverment Gilts
D. UK Goverment Gilts
E2C Intrest Rates
How does the Bank of England use the Gilt Repo Market to manage the economy?
A. It is used to increase monetary supply to expand the economy.
B. It is used to influence short-term interest rates.
C. It is used to decrease monetary supply to expand the economy.
D.It is used to influence long-term interest rates.
D.It is used to influence long-term interest rates.
1E3 Walfair and Benifits
If the UK Government decided to reduce the amount and range of State benefits, what impact is this most likely to have on UK savings, pensions and insurance provision?
a.It will increase the demand for all of these types of products.
b.The demand for pensions is likely to increase but other areas would reduce.
Incorrect
c.It will decrease the demand for all of these types of products.
d.The demand for pensions is likely to reduce but other areas would increase.
A. It will increase the demand for all of these types of products.
1E2 Economic Policy
The UK Government is looking to slow down the economy. If it solely uses monetary policies to achieve this, what action is it likely to take?
a. Increase public expenditure in infrastructure projects.
b.Increase interest rates.
c.Increase levels of Government borrowing.
d.Increase income tax.
B. Increase Intrest Rates
1D3 UK Regulation of financial services
Big Life PLC is one of the largest UK life insurance companies. As such, who would it be regulated by?
a.The PRA and the FCA.
b.The PRA and the Financial Policy Committee.
c.The PRA only.
d.The FCA only.
A. The PRA and the FCA
1E3 Welfair and Benifits
High earners should normally be advised to make contributions to private pension arrangements. This is because:
a.the State pension will typically only provide a small proportion of the retirement income they will require.
b.high earners are not entitled to the State pension.
c.the Government has increased taxes on pensions which has impacted on the size of pension funds.
d.high earners cannot benefit from compulsory employer contributions.
a.the State pension will typically only provide a small proportion of the retirement income they will require.
1B1 Financial Infrastructure
Andy works for a firm that has just bought a financial instrument from the Debt Management Office. This means that it has just invested in:
a. a new issue of UK Government-held shares.
b. existing UK Government gilts.
c. existing UK Government-held shares.
d. a new issue of UK Government gilts.
d. a new issue of UK Government gilts
1B1 Financial Inferstructure
Payment systems are important to the financial sector either because they deal with very high values or because they are widely used by customers. Which body regulates UK payment systems?
a.Payments UK.
b.The Payments Systems Regulator.
c.The Payments Council.
d.The Association of Payment Clearing Services.
B. The payment system Regulator
1B3A Banks and Building Society
Aasha has contacted her bank to give trading instructions for one of her investments. This type of transaction is known as a[n]:
a.portfolio management service.
b.discretionary investment.
c.execution-only service.
d.advisory service.
C. execution-only service.
1E2 Economic policy
If the Monetary Policy Committee increases interest rates, who is most likely to benefit?
a. People receiving State benefits.
b. Borrowers.
c. Shareholders.
d. Savings account holders.
d. Saving account Holders.
1D2 EU Regulation of financial Services
The Financial Services Action Plan [FSAP] is a key element of how financial services is regulated across the EU. The main objectives of the FSAP were designed to:
a. remove barriers and increase the cost of raising capital to EU states.
b. remove barriers and increase competition among financial services firms.
c. significantly strengthen regulation across each Member State by limiting competition.
d. increase competition by capping the charges allowed on investment and pension products.
b. remove barriers and increase competition among financial services firms.
1E2 Economic policy
A Government’s fiscal policies are concerned with the control of:
a.taxation, borrowing and Government spending methods.
b.interest rates and the money supply.
c.the money supply, borrowing and Government spending methods.
d.taxation and interest rates.
a. taxation, borrowing and Government spending methods.
1C The role and structure of international markets
Which international standards-setting body is charged with combating money laundering and related threats to the global financial system?
a.European Banking Authority.
b.Financial Action Task Force.
c.International Securities Market Association.
d.European Systemic Risk Board.
b. Financial Action Task Force.
1B3A Banks and bulding societies
What is an adviser’s regulatory status if they are only able to provide advice based on a limited range of providers?
a.Restricted - tied.
b.Restricted - multi-tied.
c.Restricted - whole of market.
d.Independent.
b. Restricted - multi-tied.
1C The role and structure of international markets
If the EU States participating in monetary union decided that they needed to increase interest rates, which regulatory body would do so?
a. The European Banking Authority.
b. The European Systemic Risk Board.
c. The European Supervisory Authority.
d. The European Central Bank.
d. The European Central Bank
