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A business may need key person protection because:
A business may need key person protection because:A . The business relies on the input of an individualB . It is a very small businessC . It is to cover a very significant customerD . Its profits are very seasonalView AnswerAnswer: A Explanation: Key Person Protection: This insurance protects a...
What term describes the process that enables savings institutions to transform into banks?
What term describes the process that enables savings institutions to transform into banks?A . DemutualisationB . Peer-to-peerC . RefinancingD . SwapView AnswerAnswer: A Explanation: Demutualisation refers to the process by which a mutual savings institution, such as a building society, converts into a publicly traded company or bank. This transformation...
Personal accident policies will pay out:
Personal accident policies will pay out:A . Once the insured has been seen by a doctorB . On the day of the accidentC . Following a waiting periodD . Once the insurance company has received the medical documentationView AnswerAnswer: C Explanation: Personal Accident Policies: These policies often include a waiting...
Why would a composite benchmark be needed to measure portfolio performance?
Why would a composite benchmark be needed to measure portfolio performance?A . It makes it easier for the fund managerB . Because the portfolio spans several asset classesC . Because the portfolio forms part of the investment universeD . To lower the tracking errorView AnswerAnswer: B Explanation: Need for a...
A company recently increased its earnings per share figure by 10%. This means that the company’s:
A company recently increased its earnings per share figure by 10%. This means that the company’s:A . Share base has widenedB . Ability to pay dividends has improvedC . Market share has risenD . P/E ratio has increasedView AnswerAnswer: B Explanation: An increase in earnings per share (EPS) indicates improved...
Once a company reaches the point known as the minimum efficient scale, the "theory of the firm" suggests that the company should:
Once a company reaches the point known as the minimum efficient scale, the "theory of the firm" suggests that the company should:A . Halt its output expansionB . Accelerate its output expansionC . Increase its unit priceD . Decrease its unit priceView AnswerAnswer: D Explanation: Minimum Efficient Scale: This is...
The Arbitrage Pricing Theory (APT) seeks to determine what factors influence security price movements using:
The Arbitrage Pricing Theory (APT) seeks to determine what factors influence security price movements using:A . Mean variance analysisB . Beta testingC . Technical analysisD . Regression analysisView AnswerAnswer: D Explanation: Understanding APT: The Arbitrage Pricing Theory (APT) uses statistical models to identify the factors influencing security prices. Regression analysis...
A rise in living standards will tend to:
A rise in living standards will tend to:A . Reduce the demand for commoditiesB . Have no effect on commoditiesC . Increase government participation in the commodities marketsD . Create an increased demand for commoditiesView AnswerAnswer: D Explanation: Understanding the Question Context: The question examines the relationship between rising living...
Why might an expansionary fiscal policy lead to future inflationary pressures?
Why might an expansionary fiscal policy lead to future inflationary pressures?A . It causes higher interest ratesB . Workers demanding higher wagesC . Due to a significant fall in private sector investmentD . Due to the effect of time lagView AnswerAnswer: B Explanation: Expansionary Fiscal Policy and Inflation: Expansionary fiscal...
Why might this happen?
When investors wish to sell units in mutual funds, there is a risk of the fund being gated. Why might this happen?A . To ensure any tax deferral benefits are not lostB . To ensure that the commission as a proportion of the fund remains smallC . Because the investor...
