Series 65 – Uniform Investment Adviser Law Exam Economic Factors and Business Information 2

Question 1

Monetary policy is primarily controlled by which entity in the United States?

Accepted Answer

The Federal Reserve

Answer

U.S. Treasury

Answer

Congress

Answer

The President

Question 2

Which of the following is an example of fiscal policy?

Accepted Answer

Congress passing a tax cut

Answer

The Federal Reserve lowering interest rates

Answer

The Fed purchasing Treasury securities

Answer

Lowering the reserve requirement

Question 3

What does GDP measure?

Accepted Answer

Total value of all goods and services produced within a country in a given period

Answer

Total stock market capitalization

Answer

Total government spending

Answer

Total corporate profits

Question 4

A company with a current ratio of 2.0 means:

Accepted Answer

Its current assets are twice its current liabilities

Answer

It has twice as many liabilities as assets

Answer

Its revenue is twice its expenses

Answer

Its stock price is double its book value

Question 5

Which type of risk refers to the possibility that a country's political or economic instability will negatively impact investments?

Accepted Answer

Country risk

Answer

Inflation risk

Answer

Credit risk

Answer

Liquidity risk

Question 6

What is the relationship between inflation and purchasing power?

Accepted Answer

Inflation decreases purchasing power

Answer

Inflation increases purchasing power

Answer

Inflation has no effect on purchasing power

Answer

Inflation only affects foreign purchasing power