QFA Investments Sample Paper 1 Prep
Test Questions with Solved Solutions
2026-2027 Updated.
In relation to its dealings with customers in the US, a business based in Ireland is directly subject
to WHICH form of investment risk?
A Exchange rate.
B Liquidity.
C Interest rate.
D Inflation. - Answer A
1.1 - Financial Services Market - Functions
Maturity transformation in relation to financial services is:
A a method of diversifying investment risk.
B turning short term deposits and savings into longer term loans.
C a form of regulatory intervention.
D a facility to allow the easy payment of bills. - Answer B
1.1 Functions
One of the main functions of the European
Central Bank (ECB) is:
A setting wholesale lending interest rates in the Eurozone area.
B fixing the exchange rate of the Euro against other currencies.
C setting rules for financial institution dealings with consumers.
D supervising the solvency of life assurance companies. - Answer A
1.2 - Key participants
The activities of the Central Bank of Ireland are managed and controlled by the:
A European Central Bank.
B European Commission.
C Central Bank Commission.
D Minister for Finance. - Answer C
,1.2 - Key participants
Overdrafts are charged interest:
A only when the overdraft limit has been exceeded.
B when used.
C if not used.
D only when fully drawn. - Answer B
1.3 - Main financial services provided
Which of the following Irish Stock Exchange markets is NOT a regulated market for MiFID
purposes?
(i)The Main Securities Market. (ii)The Enterprise Securities Market.
(iii)The Global Exchange Market.
A (i) only.
B (ii) only.
C (i) and (ii) only.
D (ii) and (iii) only. - Answer D
1.5.1 Markets
Monetary policy in the EU countries who are members of the Eurozone is under the control of
the:
A European Commission.
B European Central Bank.
C National central banks of each individual country.
D International Monetary Fund. - Answer B
2.1.1 - Monetary policy
The control of interest rates is which type of economic policy?
A Fiscal.
B Capital.
, C National.
D Monetary. - Answer D
2.1.1 - Monetary policy
A continuing increase in the price of goods and services is called:
A deflation.
B inflation.
C reflation.
D regression. - Answer B
2.2.1 - Inflation & deflation
Joan works in the tourist sector of the economy. She is laid off each October until the following
March.
When Joan becomes unemployed in October, this is an example of WHICH type of
unemployment?
A Discretionary.
B Frictional.
C Seasonal.
D Structural. - Answer C
2.3 Unemployment
Which one of the following would be considered to offer investors the HIGHEST level of
protection against inflation, over the longer term?
A Deposits.
B Corporate bonds.
C Savings Certificates.
D Equities. - Answer D
3.1 - Main investment asset classes
Which one of the following investments would be considered to offer investors the LOWEST
level of liquidity?
A Deposits.
Test Questions with Solved Solutions
2026-2027 Updated.
In relation to its dealings with customers in the US, a business based in Ireland is directly subject
to WHICH form of investment risk?
A Exchange rate.
B Liquidity.
C Interest rate.
D Inflation. - Answer A
1.1 - Financial Services Market - Functions
Maturity transformation in relation to financial services is:
A a method of diversifying investment risk.
B turning short term deposits and savings into longer term loans.
C a form of regulatory intervention.
D a facility to allow the easy payment of bills. - Answer B
1.1 Functions
One of the main functions of the European
Central Bank (ECB) is:
A setting wholesale lending interest rates in the Eurozone area.
B fixing the exchange rate of the Euro against other currencies.
C setting rules for financial institution dealings with consumers.
D supervising the solvency of life assurance companies. - Answer A
1.2 - Key participants
The activities of the Central Bank of Ireland are managed and controlled by the:
A European Central Bank.
B European Commission.
C Central Bank Commission.
D Minister for Finance. - Answer C
,1.2 - Key participants
Overdrafts are charged interest:
A only when the overdraft limit has been exceeded.
B when used.
C if not used.
D only when fully drawn. - Answer B
1.3 - Main financial services provided
Which of the following Irish Stock Exchange markets is NOT a regulated market for MiFID
purposes?
(i)The Main Securities Market. (ii)The Enterprise Securities Market.
(iii)The Global Exchange Market.
A (i) only.
B (ii) only.
C (i) and (ii) only.
D (ii) and (iii) only. - Answer D
1.5.1 Markets
Monetary policy in the EU countries who are members of the Eurozone is under the control of
the:
A European Commission.
B European Central Bank.
C National central banks of each individual country.
D International Monetary Fund. - Answer B
2.1.1 - Monetary policy
The control of interest rates is which type of economic policy?
A Fiscal.
B Capital.
, C National.
D Monetary. - Answer D
2.1.1 - Monetary policy
A continuing increase in the price of goods and services is called:
A deflation.
B inflation.
C reflation.
D regression. - Answer B
2.2.1 - Inflation & deflation
Joan works in the tourist sector of the economy. She is laid off each October until the following
March.
When Joan becomes unemployed in October, this is an example of WHICH type of
unemployment?
A Discretionary.
B Frictional.
C Seasonal.
D Structural. - Answer C
2.3 Unemployment
Which one of the following would be considered to offer investors the HIGHEST level of
protection against inflation, over the longer term?
A Deposits.
B Corporate bonds.
C Savings Certificates.
D Equities. - Answer D
3.1 - Main investment asset classes
Which one of the following investments would be considered to offer investors the LOWEST
level of liquidity?
A Deposits.
