UK Financial Market Quiz! Trivia

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| By Ojharahul
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Quizzes Created: 1 | Total Attempts: 123
Questions: 9 | Attempts: 123

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UK Financial Market Quiz! Trivia - Quiz


Here we go with a UK Financial Markets Quiz! A financial market gives people and companies the ability to sell and buy financial derivatives and securities such as stock, bonds, and future contracts. Different types of financial markets in the UK include forex, bond, stock, and money markets. This quiz will help you see just how much you know about trading in these markets and some of the common things you should know.


Questions and Answers
  • 1. 

    Which one of the following factors is most likely to influence foreign exchange rates? 

    • A.

      Mortgage rate

    • B.

      Increase in money supply

    • C.

      Interest rates

    • D.

      Country's borrowing requirements

    Correct Answer
    C. Interest rates
    Explanation
    The two main factors underlying the value of a currency and foreign exchange rates are the underlying economic performance of the country and comparative interest rates.

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  • 2. 

    Which ONE of the following financial institutions acts as a depositary for portfolios as a core service?

    • A.

      Custodians

    • B.

      Insurance companies

    • C.

      Stockbrokers

    • D.

      Retail banks

    Correct Answer
    A. Custodians
    Explanation
    Custodians are banks that specialize in safe custody services, looking after portfolios of shares and bonds on behalf of others.

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  • 3. 

    Which ONE of the following is the usual measure of the total value of goods and services produced within the UK?

    • A.

      GNP

    • B.

      GDP

    • C.

      RPI

    • D.

      PSNCR

    Correct Answer
    B. GDP
    Explanation
    GDP is Gross Domestic Product - it is used as a measure of the UK’s output. It is the total of consumer spending, investment and government spending plus the value of exports minus the value of imports.

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  • 4. 

    Which ONE of the following is the index used as the official measure of inflation?

    • A.

      MRI

    • B.

      GDP

    • C.

      RPI

    • D.

      HICP

    Correct Answer
    D. HICP
    Explanation
    The correct answer is HICP. HICP stands for Harmonized Index of Consumer Prices and is used as the official measure of inflation. It is a measure of price changes of goods and services consumed by households and is used by the European Union and European Central Bank to monitor inflation rates across member countries.

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  • 5. 

    Which ONE of the following is specifically adjusted for the impact of overseas investment in UK businesses?

    • A.

      GNP

    • B.

      PSNCR

    • C.

      GDP

    • D.

      Balance of payments

    Correct Answer
    A. GNP
    Explanation
    GDP (Gross Domestic Product) is a measure of the total of consumer, investment, and government spending plus the value of exports minus the value of imports. GNP (Gross National Product) is the total of GDP plus the income accruing to domestic residents from investments abroad minus income earned in domestic markets accruing to foreigners abroad. The figure, therefore, includes the impact of overseas holdings and investments in businesses.

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  • 6. 

    Which ONE of the following describes the shortfall between government revenues and expenditure?

    • A.

      PSDR

    • B.

      PSNCR

    • C.

      RPI

    • D.

      GDP

    Correct Answer
    B. PSNCR
    Explanation
    If the government spends more than it receives from tax and other revenues, the shortfall is known as the Public Sector Net Cash Requirement (PSNCR) which must be borrowed.

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  • 7. 

    Which ONE of the following is NOT used to measure inflation?

    • A.

      HICP

    • B.

      RPI

    • C.

      GDP

    • D.

      RPIX

    Correct Answer
    C. GDP
    Explanation
    GDP is the gross domestic product and is not used to measure inflation. RPI is the retail price index, RPIX is the retail price index excluding mortgage interest and HICP is the harmonized index of consumer prices.

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  • 8. 

    Interest rates are set by the Monetary Policy Committee of which ONE of the following organizations?

    • A.

      The Office of Fair Trading

    • B.

      The Treasury

    • C.

      The Department of Trade and Industry

    • D.

      The Bank of England

    Correct Answer
    D. The Bank of England
    Explanation
    The Monetary Policy Committee of the Bank of England sets interest rates.

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  • 9. 

     Which ONE of the following measures the difference between a country’s exports and imports?

    • A.

      Gross National Product

    • B.

      Gross Domestic Product

    • C.

      Balance of Payments

    • D.

      Public Sector Net Cash Requirement

    Correct Answer
    C. Balance of Payments
    Explanation
    The balance of payments is a summary of all the transactions between a country and the rest of the world and will measure the difference as a deficit or surplus. Gross National Product is the measure of a country’s output (Gross Domestic Product) plus net property income from abroad. Public Sector Net Cash Requirement is the difference between Government expenditure and Government income.

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Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • May 08, 2009
    Quiz Created by
    Ojharahul
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