art mcqs

How does investment duration affect returns?

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There is no relationship whatsoever
With greater duration of investment returns are larger
If the duration is larger the rate of returns is likely to be smaller
With greater duration of investment larger tax possibility is likely
✅ The correct answer is B.
investment duration affect returns with greater duration of investment returns are larger. Generally, the higher the duration of a bond or a bond fund (meaning the longer you need to wait for the payment of coupons and return of principal), the more its price will drop as interest rates rise.

What describes a process of continuously measuring results and comparing those results to optimal performance so that actual performance may be improved?

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Performance
Capacity planning
Benchmarking
Data cleansing
✅ The correct answer is C.
Benchmarking describes a process of continuously measuring results and comparing those results to optimal performance so that actual performance may be improved.

Value generally promises to pay at maturity date and a firm borrows is considered as bonds

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bond value
per value
state value
par value
✅ The correct answer is D.
Value generally promises to pay at maturity date and a firm borrows is considered as bonds par value. The par value of a bond also called the face amount or face value is the value written on the front of the bond.

Most financial advisors are registered with the Securities and Exchange Commission as_______________.

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registered representatives
registered investor advisors
registered financial planners
registered securities consultants
✅ The correct answer is C.
Most financial advisors are registered with the Securities and Exchange Commission as registered financial planners. A financial planner is a qualified investment professional who helps individuals and corporations meet their long-term financial objectives.

Long-term equity anticipation security is usually classified as

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short-term options
long-term options
short money options
yearly call
✅ The correct answer is B.
Long-term equity anticipation security is usually classified as long-term options. Long-term equity anticipation securities (LEAPS) are publicly traded options contracts with expiration dates that are longer than one year.

Quality of a commodity that satisfies some human want or need is called

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Service
Demand
Utility
Efficiency
✅ The correct answer is C.
Quality of a commodity that satisfies some human want or need is called Utility. Within economics the concept of utility is used to model worth or value, but its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or satisfaction within the theory of utilitarianism by moral philosophers such as Jeremy Bentham and John Stuart Mill.

Which of the following statements is incorrect?

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Insurance agent should indicate the scale of commission if asked by the customer
Insurance agent should share the commission by way of rebate
Insurance agent should disclose his licence on demand
Insurance agent should indicate the premium to be charged
✅ The correct answer is B.
All the options are correct, except option 3. Sharing commission with a client is illegal.