QFA INVESTMENTS SAMPLE PAPER 2
QUESTIONS WITH CORRECT ANSWERS
The ppfinancial ppservices ppmarket ppin ppIreland ppenables ppproviders ppto ppcollect
ppsurplus ppfunds ppas ppsavings ppand pplend ppthem ppat ppa ppmargin ppto:
A ppindividuals pponly.
B ppbusinesses pponly.
C ppindividuals ppand ppbusinesses pponly.
D ppindividuals, ppbusinesses ppand ppthe ppGovernment. pp- ppAnswer ppD pp
1.1 pp- ppFunctions
Home pploan ppborrowers ppon ppa ppstandard ppvariable pprate ppmortgage ppare ppsubject
ppto ppWHICH pptype ppof ppinvestment pprisk?
A ppCurrency.
B ppLiquidity.
C ppInterest pprate. pp
D ppInflation. pp- ppAnswer ppC pp
1.1 pp- ppFunctions ppof ppfinancial ppservices
Which ppone ppof ppthe ppfollowing ppis ppalways ppstructured ppas ppa ppfinancial ppco-
operative?
A ppA ppretail ppbank.
B ppA ppcredit ppunion.
C ppA ppMIFID ppinvestment ppfirm.
D ppA pplife ppassurance ppcompany. pp- ppAnswer ppB pp
1.2 pp- ppKey ppparticipants
Investment ppfirms ppare ppalso ppknown ppas ppwhich pptype ppof ppfirm?
A ppSection pp10.
B ppMulti ppAgency.
C ppAuthorised ppAdvisers. pp
D ppMiFID. pp- ppAnswer ppD pp
1.2 pp- ppKey ppparticipants
,Mary pphas ppentered ppa pplease pparrangement ppwith ppa ppfinancial ppinstitution ppfor ppa
ppcar. ppWhich ppone ppof ppthe ppfollowing ppis ppcorrect?
A ppThe ppfinancial ppinstitution ppnever ppowns ppthe ppcar.
B ppMary ppautomatically ppbecomes ppthe ppowner ppof
the ppcar ppwhen ppshe ppsigns ppthe pplease.
C ppThe ppfinancial ppinstitution ppowns ppthe ppcar ppduring ppthe ppterm ppof ppthe pplease.
D ppMary ppautomatically ppbecomes ppthe ppowner ppof ppthe ppcar ppwhen ppshe ppmakes
ppthe ppfirst pppayment. pp- ppAnswer ppC pp
1.3 pp- ppMain ppfinancial ppservices ppprovided
Which ppone ppof ppthe ppfollowing ppmarkets ppis ppa ppregulated ppmarket ppfor ppMiFID
pppurposes?
A ppIrish ppStock ppExchange ppGlobal ppExchange.
B ppIrish ppStock ppExchange ppEnterprise ppSecurities. pp
C ppIrish ppStock ppExchange ppMain ppSecurities.
D ppIrish ppStock ppExchange ppBond ppSwap. pp- ppAnswer ppC pp
1.5.1 pp- ppMarkets
The ppcontrol ppof ppthe ppmagnitude ppof ppthe ppmoney ppsupply ppin ppthe ppeconomy ppis
ppwhich pptype ppof ppeconomic pppolicy?
A ppFiscal.
B ppCapital.
C ppNational.
D ppMonetary. pp- ppAnswer ppD pp
2.1.1 pp- ppMonetary pppolicy
Which ppmeasurement ppof ppthe ppIrish ppeconomy ppincludes ppthe ppvalue ppof ppgoods
ppand ppservices ppproduced ppby ppIrish ppfirms ppoperating ppin ppforeign ppcountries?
A ppForeign ppNational ppProduct pp(FNP). pp
B ppGross ppDomestic ppProduct pp(GDP). pp
C ppGross ppNational ppProduct pp(GNP). pp
D ppNet ppNational ppGrowth pp(NNG) pp- ppAnswer ppC pp
2.2 pp- ppEconomic ppgrowth
Deflation ppcan ppbe ppcaused ppby:
(i) ppan ppincrease ppin ppsales pptax.
(ii) ppa ppreduction ppin ppproducers ppmark ppup pp%.
(iii) ppa ppdecrease ppin ppthe pplevel ppof ppdemand ppfor ppgoods ppand ppservices.
A pp(i) pponly.
B pp(iii) pponly.
C pp(i) ppand pp(ii) pponly.
, D pp(ii) ppand pp(iii) pponly. pp- ppAnswer ppD pp
2.2.3 pp- ppCauses ppof ppdeflation
The ppbenefits ppof ppincreased ppinternational pptrade ppinclude ppwhich ppone ppof ppthe
ppfollowing:
A pptotal ppoutput ppis ppincreased.
B pphigher ppinflation.
C ppgreater ppmarket ppinefficiencies. pp
D ppconcentration ppof ppwealth. pp- ppAnswer ppA pp
2.4 pp- ppInternational pptrade
When ppcompared ppto ppequities, ppproperty ppas ppan ppinvestment ppis ppexpected ppto:
A ppoffer ppa pplower ppreturn.
B ppoffer ppa pphigher ppreturn.
C ppoffer pplower ppprotection ppagainst ppinflation.
D pphave ppa ppsignificantly pplower pplevel ppof ppliquidity. pp- ppAnswer ppD pp
3.1 pp- ppMain ppinvestment ppasset ppclasses
Traditional ppinvestment ppasset ppclasses ppinclude:
(i) ppbonds. pp
(ii) ppgold.
(iii) ppequities.
A pp(i) ppand pp(ii) pponly. pp
B pp(i) ppand pp(iii) pponly. pp
C pp(ii) ppand pp(iii) pponly. pp
D pp(i), pp(ii) ppand pp(iii). pp- ppAnswer ppB pp
3.1 pp- ppMain ppinvestment ppasset ppclasses
Which ppone ppof ppthe ppfollowing ppwould ppNOT ppbe ppconsidered ppto ppbe ppan
ppexample ppof ppan ppalternative ppinvestment ppclass?
A ppGold.
B ppPrivate ppequity.
C ppCommodities.
D ppGovernment ppbonds. pp- ppAnswer ppD pp
3.3 pp- ppAlternative ppasset ppclasses
The ppstandard ppdeviation ppof ppinvestment ppreturns ppis ppa ppway ppto ppmeasure:
A ppcorrelation ppof ppreturns. pp
B ppinvestment pprisk.
C ppdiversification.
QUESTIONS WITH CORRECT ANSWERS
The ppfinancial ppservices ppmarket ppin ppIreland ppenables ppproviders ppto ppcollect
ppsurplus ppfunds ppas ppsavings ppand pplend ppthem ppat ppa ppmargin ppto:
A ppindividuals pponly.
B ppbusinesses pponly.
C ppindividuals ppand ppbusinesses pponly.
D ppindividuals, ppbusinesses ppand ppthe ppGovernment. pp- ppAnswer ppD pp
1.1 pp- ppFunctions
Home pploan ppborrowers ppon ppa ppstandard ppvariable pprate ppmortgage ppare ppsubject
ppto ppWHICH pptype ppof ppinvestment pprisk?
A ppCurrency.
B ppLiquidity.
C ppInterest pprate. pp
D ppInflation. pp- ppAnswer ppC pp
1.1 pp- ppFunctions ppof ppfinancial ppservices
Which ppone ppof ppthe ppfollowing ppis ppalways ppstructured ppas ppa ppfinancial ppco-
operative?
A ppA ppretail ppbank.
B ppA ppcredit ppunion.
C ppA ppMIFID ppinvestment ppfirm.
D ppA pplife ppassurance ppcompany. pp- ppAnswer ppB pp
1.2 pp- ppKey ppparticipants
Investment ppfirms ppare ppalso ppknown ppas ppwhich pptype ppof ppfirm?
A ppSection pp10.
B ppMulti ppAgency.
C ppAuthorised ppAdvisers. pp
D ppMiFID. pp- ppAnswer ppD pp
1.2 pp- ppKey ppparticipants
,Mary pphas ppentered ppa pplease pparrangement ppwith ppa ppfinancial ppinstitution ppfor ppa
ppcar. ppWhich ppone ppof ppthe ppfollowing ppis ppcorrect?
A ppThe ppfinancial ppinstitution ppnever ppowns ppthe ppcar.
B ppMary ppautomatically ppbecomes ppthe ppowner ppof
the ppcar ppwhen ppshe ppsigns ppthe pplease.
C ppThe ppfinancial ppinstitution ppowns ppthe ppcar ppduring ppthe ppterm ppof ppthe pplease.
D ppMary ppautomatically ppbecomes ppthe ppowner ppof ppthe ppcar ppwhen ppshe ppmakes
ppthe ppfirst pppayment. pp- ppAnswer ppC pp
1.3 pp- ppMain ppfinancial ppservices ppprovided
Which ppone ppof ppthe ppfollowing ppmarkets ppis ppa ppregulated ppmarket ppfor ppMiFID
pppurposes?
A ppIrish ppStock ppExchange ppGlobal ppExchange.
B ppIrish ppStock ppExchange ppEnterprise ppSecurities. pp
C ppIrish ppStock ppExchange ppMain ppSecurities.
D ppIrish ppStock ppExchange ppBond ppSwap. pp- ppAnswer ppC pp
1.5.1 pp- ppMarkets
The ppcontrol ppof ppthe ppmagnitude ppof ppthe ppmoney ppsupply ppin ppthe ppeconomy ppis
ppwhich pptype ppof ppeconomic pppolicy?
A ppFiscal.
B ppCapital.
C ppNational.
D ppMonetary. pp- ppAnswer ppD pp
2.1.1 pp- ppMonetary pppolicy
Which ppmeasurement ppof ppthe ppIrish ppeconomy ppincludes ppthe ppvalue ppof ppgoods
ppand ppservices ppproduced ppby ppIrish ppfirms ppoperating ppin ppforeign ppcountries?
A ppForeign ppNational ppProduct pp(FNP). pp
B ppGross ppDomestic ppProduct pp(GDP). pp
C ppGross ppNational ppProduct pp(GNP). pp
D ppNet ppNational ppGrowth pp(NNG) pp- ppAnswer ppC pp
2.2 pp- ppEconomic ppgrowth
Deflation ppcan ppbe ppcaused ppby:
(i) ppan ppincrease ppin ppsales pptax.
(ii) ppa ppreduction ppin ppproducers ppmark ppup pp%.
(iii) ppa ppdecrease ppin ppthe pplevel ppof ppdemand ppfor ppgoods ppand ppservices.
A pp(i) pponly.
B pp(iii) pponly.
C pp(i) ppand pp(ii) pponly.
, D pp(ii) ppand pp(iii) pponly. pp- ppAnswer ppD pp
2.2.3 pp- ppCauses ppof ppdeflation
The ppbenefits ppof ppincreased ppinternational pptrade ppinclude ppwhich ppone ppof ppthe
ppfollowing:
A pptotal ppoutput ppis ppincreased.
B pphigher ppinflation.
C ppgreater ppmarket ppinefficiencies. pp
D ppconcentration ppof ppwealth. pp- ppAnswer ppA pp
2.4 pp- ppInternational pptrade
When ppcompared ppto ppequities, ppproperty ppas ppan ppinvestment ppis ppexpected ppto:
A ppoffer ppa pplower ppreturn.
B ppoffer ppa pphigher ppreturn.
C ppoffer pplower ppprotection ppagainst ppinflation.
D pphave ppa ppsignificantly pplower pplevel ppof ppliquidity. pp- ppAnswer ppD pp
3.1 pp- ppMain ppinvestment ppasset ppclasses
Traditional ppinvestment ppasset ppclasses ppinclude:
(i) ppbonds. pp
(ii) ppgold.
(iii) ppequities.
A pp(i) ppand pp(ii) pponly. pp
B pp(i) ppand pp(iii) pponly. pp
C pp(ii) ppand pp(iii) pponly. pp
D pp(i), pp(ii) ppand pp(iii). pp- ppAnswer ppB pp
3.1 pp- ppMain ppinvestment ppasset ppclasses
Which ppone ppof ppthe ppfollowing ppwould ppNOT ppbe ppconsidered ppto ppbe ppan
ppexample ppof ppan ppalternative ppinvestment ppclass?
A ppGold.
B ppPrivate ppequity.
C ppCommodities.
D ppGovernment ppbonds. pp- ppAnswer ppD pp
3.3 pp- ppAlternative ppasset ppclasses
The ppstandard ppdeviation ppof ppinvestment ppreturns ppis ppa ppway ppto ppmeasure:
A ppcorrelation ppof ppreturns. pp
B ppinvestment pprisk.
C ppdiversification.
