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Advanced Wealth Management Course (IIBF) - Paper 3

Part III: Ch 4: Economic Analysis

Q1.

The output gap grows during an expansion and falls during a recession.

True

False

Q2.

(I) During contraction phase both capital and labour deployment increase above the normal level of deployment. (II) Decline in the interest rates gas led to increased competition among marketers.

Both the statements are correct

Only statement (I) is correct

Only statement (II) is correct

Both the statements are wrong

Q3.

(I) The level of interest rates can determine the level of demand of company’s products. (II) A higher rate of inflation can potentially result in slow economic growth, higher interest rates, and volatile currency movements.

Both the statements are correct

Only statement (I) is correct

Only statement (II) is correct

Both the statements are wrong

Q4.

The business cycle concept has been based upon historical sequence of movements of economic activity.

True

False

Q5.

(I) A higher rate of inflation can potentially result in higher economic growth. (II) The output gap measures the gap between the actual output and the potential output.

Both the statements are correct

Only statement (I) is correct

Only statement (II) is correct

Both the statements are wrong

Q6.

A transparent and effective regulatory environment helps in reducing riskiness of a business.

True

False

Q7.

In the larger social arena, major forces currently affecting various businesses include:

Increasing individualism

Increasing consumerism