Investment Management Certificate Unit
1 questions with answers.
1 Financial intermediaries ANS -Reduce information and transaction costs
Four functions of the financial industry ANS -1. Financial Intermediation
2. Pooling and managing risk
3. Payments and settlement services
4. Portfolio Management
2 Pooling and managing risk ANS -Pooling investors' money to reduce overall risk exposure.
3. Payments and settlement services ANS -Settlement services provided by clearing houses
4. Portfolio Management ANS -Manage wealth through market access.
Deposit institutions ANS -Accepts deposits from economic agents. The deposits become liabilities of
these institutions, which lend funds as direct loans or investment.
Investment Institutions ANS -Invest their funds in tradable securities.
The role of government ANS -1. Providing Services that private firms are either unwilling or not allowed
to provide.
2. Regulating firms and markets to protect the customer.
3. Intervening in the distribution of income generated by private market transactions.
4. Stabilising the economy.
Real Assets vs Financial Assets ANS -Real assets are physical assets.
Financial assets are claims representing the right to some return or ownership.
1 questions with answers.
1 Financial intermediaries ANS -Reduce information and transaction costs
Four functions of the financial industry ANS -1. Financial Intermediation
2. Pooling and managing risk
3. Payments and settlement services
4. Portfolio Management
2 Pooling and managing risk ANS -Pooling investors' money to reduce overall risk exposure.
3. Payments and settlement services ANS -Settlement services provided by clearing houses
4. Portfolio Management ANS -Manage wealth through market access.
Deposit institutions ANS -Accepts deposits from economic agents. The deposits become liabilities of
these institutions, which lend funds as direct loans or investment.
Investment Institutions ANS -Invest their funds in tradable securities.
The role of government ANS -1. Providing Services that private firms are either unwilling or not allowed
to provide.
2. Regulating firms and markets to protect the customer.
3. Intervening in the distribution of income generated by private market transactions.
4. Stabilising the economy.
Real Assets vs Financial Assets ANS -Real assets are physical assets.
Financial assets are claims representing the right to some return or ownership.
