QFA INVESTMENTS - SAMPLE PAPER 4
QUESTIONS WITH CORRECT ANSWERS
Maturity uutransformation uuin uurelation uuto uufinancial uuservices uuis: uu
A. uua uumethod uuof uudiversifying uuinvestment uurisk. uu
B. uuturning uushort uuterm uudeposits uuand uusavings uuinto uulonger uuterm uuloans. uu
C. uua uuform uuof uuregulatory uuintervention. uu
D. uua uufacility uuto uuallow uuthe uueasy uupayment uuof uubills uu- uuAnswer uuB
turning uushort uuterm uudeposits uuand uusavings uuinto uulonger uuterm uuloans.
The uufinancial uuservices uumarket uuin uuIreland uuenables uuproviders uuto uucollect
uusurplus uufunds uuas uusavings uuand uulend uuthem uuat uua uumargin uuto: uu
A. uuindividuals uuonly. uu
B. uubusinesses uuonly. uu
C. uuindividuals uuand uubusinesses uuonly. uu
D. uuindividuals, uubusinesses, uuand uuthe uuGovernment. uu- uuAnswer uuD
individuals, uubusinesses, uuand uuthe uuGovernment.
Which uuone uuof uuthe uufollowing uuis uualways uustructured uuas uua uufinancial uuco-
operative? uu
A. uuA uuretail uubank. uu
B. uuA uucredit uuunion. uu
C. uuA uuMIFID uuinvestment uufirm. uu
D. uuA uulife uuassurance uucompany. uu- uuAnswer uuB
A uucredit uuunion
Overdrafts uuare uucharged uuinterest: uu
A. uuonly uuwhen uuthe uuoverdraft uulimit uuhas uubeen uuexceeded. uu
B. uuwhen uuused. uu
C. uuif uunot uuused. uu
D. uuonly uuwhen uufully uudrawn uu- uuAnswer uuB
when uuused.
,Which uuone uuof uuthe uufollowing uumarkets uuis uua uuregulated uumarket uufor uuMiFID
uupurposes? uu
A. uuIrish uuStock uuExchange uuGlobal uuExchange. uu
B. uuIrish uuStock uuExchange uuEnterprise uuSecurities. uu
C. uuIrish uuStock uuExchange uuMain uuSecurities. uu
D. uuIrish uuStock uuExchange uuBond uuSwap. uu- uuAnswer uuC
Irish uuStock uuExchange uuMain uuSecurities.
The uucontrol uuof uuinterest uurates uuis uuwhich uutype uuof uueconomic uupolicy? uu
A. uuFiscal. uu
B. uuCapital. uu
C. uuNational. uu
D. uuMonetary uu- uuAnswer uuD
Monetary
Which uumeasurement uuof uuthe uuIrish uueconomy uuincludes uuthe uuvalue uuof uugoods
uuand uuservices uuproduced uuby uuIrish uufirms uuoperating uuin uuforeign uucountries? uu
A. uuForeign uuNational uuProduct uu(FNP). uu
B. uuGross uuDomestic uuProduct uu(GDP). uu
C. uuGross uuNational uuProduct uu(GNP). uu
D. uuNet uuNational uuGrowth uu(NNG) uu- uuAnswer uuC
Gross uuNational uuProduct uu(GNP).
Deflation uucan uube uucaused uuby: uu
(i) uuan uuincrease uuin uusales uutax. uu
(ii) uua uureduction uuin uuproducers uumark uuup uu%. uu
(iii) uua uudecrease uuin uuthe uulevel uuof uudemand uufor uugoods uuand uuservices uu
A. uu(i) uuonly. uu
B. uu(iii) uuonly. uu
C. uu(i) uuand uu(ii) uuonly. uu
D. uu(ii) uuand uu(iii) uuonly uu- uuAnswer uuD
(ii) uuand uu(iii) uuonly
Joan uuworks uuin uuthe uutourist uusector uuof uuthe uueconomy. uuShe uuis uulaid uuoff uueach
uuOctober uuuntil uuthe uufollowing uuMarch. uuWhen uuJoan uubecomes uuunemployed uuin
uuOctober, uuthis uuis uuan uuexample uuof uuWHICH uutype uuof uuunemployment? uu
A. uuDiscretionary. uu
B. uuFrictional. uu
C. uuSeasonal. uu
D. uuStructural. uu- uuAnswer uuC
Seasonal.
, When uucompared uuto uuequities, uuproperty uuas uuan uuinvestment uuis uuexpected uuto: uu
A. uuoffer uua uulower uureturn. uu
B. uuoffer uua uuhigher uureturn. uu
C. uuoffer uulower uuprotection uuagainst uuinflation. uu
D. uuhave uua uusignificantly uulower uulevel uuof uuliquidity. uu- uuAnswer uuD
have uua uusignificantly uulower uulevel uuof uuliquidity.
Which uuone uuof uuthe uufollowing uuinvestment uutypes uuhas uushown uuthe uuHIGHEST
uulevel uuof uuvolatility uuof uureturns uuover uuthe uulonger uuterm? uu
A. uuDeposits. uu
B. uuCorporate uubonds. uu
C. uuEquities. uu
D. uuGovernment uubonds uu- uuAnswer uuC
Equities.
The uustandard uudeviation uuof uuinvestment uureturns uuis uua uuway uuto uumeasure: uu
A. uucorrelation uuof uureturns. uu
B. uuinvestment uurisk. uu
C. uudiversification uu
D. uuinvestor uuconfidence uu- uuAnswer uuB
investment uurisk.
Another uuterm uuused uuto uudescribe uuinvestment uurisk uuis: uu
A. uuvolatility. uu
B. uucorrelation. uu
C. uuconcentration. uu
D. uumaximisation uu- uuAnswer uuA
volatility.
Which uuof uuthe uufollowing uufunds uuprovides uudiversification uubetween uuthe uumain
uuasset uuclasses? uu
A. uuA uumanaged uufund uuinvesting uuin uua uumix uuof uushares, uubonds uuand uuproperty.
uu
B. uuAn uuequity uufund uuinvesting uuin uua uumix uuof uuEuropean uuand uuinternational
uuequities. uu
C. uuA uubond uufund uuinvesting uuin uua uumix uuof uubonds uuissued uuby uularge
uuinternational uucompanies. uu
D. uuA uudeposit uufund, uuwhich uuinvests uuin uudeposits uuwith uua uuwide uurange uuof
uubanks uu- uuAnswer uuA
A uumanaged uufund uuinvesting uuin uua uumix uuof uushares, uubonds uuand uuproperty.
QUESTIONS WITH CORRECT ANSWERS
Maturity uutransformation uuin uurelation uuto uufinancial uuservices uuis: uu
A. uua uumethod uuof uudiversifying uuinvestment uurisk. uu
B. uuturning uushort uuterm uudeposits uuand uusavings uuinto uulonger uuterm uuloans. uu
C. uua uuform uuof uuregulatory uuintervention. uu
D. uua uufacility uuto uuallow uuthe uueasy uupayment uuof uubills uu- uuAnswer uuB
turning uushort uuterm uudeposits uuand uusavings uuinto uulonger uuterm uuloans.
The uufinancial uuservices uumarket uuin uuIreland uuenables uuproviders uuto uucollect
uusurplus uufunds uuas uusavings uuand uulend uuthem uuat uua uumargin uuto: uu
A. uuindividuals uuonly. uu
B. uubusinesses uuonly. uu
C. uuindividuals uuand uubusinesses uuonly. uu
D. uuindividuals, uubusinesses, uuand uuthe uuGovernment. uu- uuAnswer uuD
individuals, uubusinesses, uuand uuthe uuGovernment.
Which uuone uuof uuthe uufollowing uuis uualways uustructured uuas uua uufinancial uuco-
operative? uu
A. uuA uuretail uubank. uu
B. uuA uucredit uuunion. uu
C. uuA uuMIFID uuinvestment uufirm. uu
D. uuA uulife uuassurance uucompany. uu- uuAnswer uuB
A uucredit uuunion
Overdrafts uuare uucharged uuinterest: uu
A. uuonly uuwhen uuthe uuoverdraft uulimit uuhas uubeen uuexceeded. uu
B. uuwhen uuused. uu
C. uuif uunot uuused. uu
D. uuonly uuwhen uufully uudrawn uu- uuAnswer uuB
when uuused.
,Which uuone uuof uuthe uufollowing uumarkets uuis uua uuregulated uumarket uufor uuMiFID
uupurposes? uu
A. uuIrish uuStock uuExchange uuGlobal uuExchange. uu
B. uuIrish uuStock uuExchange uuEnterprise uuSecurities. uu
C. uuIrish uuStock uuExchange uuMain uuSecurities. uu
D. uuIrish uuStock uuExchange uuBond uuSwap. uu- uuAnswer uuC
Irish uuStock uuExchange uuMain uuSecurities.
The uucontrol uuof uuinterest uurates uuis uuwhich uutype uuof uueconomic uupolicy? uu
A. uuFiscal. uu
B. uuCapital. uu
C. uuNational. uu
D. uuMonetary uu- uuAnswer uuD
Monetary
Which uumeasurement uuof uuthe uuIrish uueconomy uuincludes uuthe uuvalue uuof uugoods
uuand uuservices uuproduced uuby uuIrish uufirms uuoperating uuin uuforeign uucountries? uu
A. uuForeign uuNational uuProduct uu(FNP). uu
B. uuGross uuDomestic uuProduct uu(GDP). uu
C. uuGross uuNational uuProduct uu(GNP). uu
D. uuNet uuNational uuGrowth uu(NNG) uu- uuAnswer uuC
Gross uuNational uuProduct uu(GNP).
Deflation uucan uube uucaused uuby: uu
(i) uuan uuincrease uuin uusales uutax. uu
(ii) uua uureduction uuin uuproducers uumark uuup uu%. uu
(iii) uua uudecrease uuin uuthe uulevel uuof uudemand uufor uugoods uuand uuservices uu
A. uu(i) uuonly. uu
B. uu(iii) uuonly. uu
C. uu(i) uuand uu(ii) uuonly. uu
D. uu(ii) uuand uu(iii) uuonly uu- uuAnswer uuD
(ii) uuand uu(iii) uuonly
Joan uuworks uuin uuthe uutourist uusector uuof uuthe uueconomy. uuShe uuis uulaid uuoff uueach
uuOctober uuuntil uuthe uufollowing uuMarch. uuWhen uuJoan uubecomes uuunemployed uuin
uuOctober, uuthis uuis uuan uuexample uuof uuWHICH uutype uuof uuunemployment? uu
A. uuDiscretionary. uu
B. uuFrictional. uu
C. uuSeasonal. uu
D. uuStructural. uu- uuAnswer uuC
Seasonal.
, When uucompared uuto uuequities, uuproperty uuas uuan uuinvestment uuis uuexpected uuto: uu
A. uuoffer uua uulower uureturn. uu
B. uuoffer uua uuhigher uureturn. uu
C. uuoffer uulower uuprotection uuagainst uuinflation. uu
D. uuhave uua uusignificantly uulower uulevel uuof uuliquidity. uu- uuAnswer uuD
have uua uusignificantly uulower uulevel uuof uuliquidity.
Which uuone uuof uuthe uufollowing uuinvestment uutypes uuhas uushown uuthe uuHIGHEST
uulevel uuof uuvolatility uuof uureturns uuover uuthe uulonger uuterm? uu
A. uuDeposits. uu
B. uuCorporate uubonds. uu
C. uuEquities. uu
D. uuGovernment uubonds uu- uuAnswer uuC
Equities.
The uustandard uudeviation uuof uuinvestment uureturns uuis uua uuway uuto uumeasure: uu
A. uucorrelation uuof uureturns. uu
B. uuinvestment uurisk. uu
C. uudiversification uu
D. uuinvestor uuconfidence uu- uuAnswer uuB
investment uurisk.
Another uuterm uuused uuto uudescribe uuinvestment uurisk uuis: uu
A. uuvolatility. uu
B. uucorrelation. uu
C. uuconcentration. uu
D. uumaximisation uu- uuAnswer uuA
volatility.
Which uuof uuthe uufollowing uufunds uuprovides uudiversification uubetween uuthe uumain
uuasset uuclasses? uu
A. uuA uumanaged uufund uuinvesting uuin uua uumix uuof uushares, uubonds uuand uuproperty.
uu
B. uuAn uuequity uufund uuinvesting uuin uua uumix uuof uuEuropean uuand uuinternational
uuequities. uu
C. uuA uubond uufund uuinvesting uuin uua uumix uuof uubonds uuissued uuby uularge
uuinternational uucompanies. uu
D. uuA uudeposit uufund, uuwhich uuinvests uuin uudeposits uuwith uua uuwide uurange uuof
uubanks uu- uuAnswer uuA
A uumanaged uufund uuinvesting uuin uua uumix uuof uushares, uubonds uuand uuproperty.
