Which of the following transactions takes place in the secondary market?
Answer(s): D
The secondary market involves trading previously issued securities between investors, enabling liquidity for those who initially purchased the securities. The feedback from the document states:"The secondary market involves the resale of previously issued securities between investors. It enables investors who originally bought the investment products to sell them and obtain cash."
Chapter 2 Overview of the Canadian Financial MarketplaceLearning Domain: An Introduction to the Mutual Funds Marketplace
Which exchange in Canada deals exclusively with financial and equity futures and options?
Answer(s): A
The Montreal Exchange (also referred to as Bourse de Montreal) is the only Canadian exchange specializing exclusively in financial and equity futures and options. The feedback from the document confirms:"The Montreal Exchange (Bourse de Montreal) is the only exchange in Canada that deals exclusively with financial and equity futures and options."
What term applies to unemployment created by a new technology that eliminates the need for subway train drivers?
Structural unemployment results from economic changes, such as technological advancements that reduce the demand for certain types of labor. The feedback from the document states:"Structural unemployment results from changes in the economy, such as technological advances that reduce the need for human labour."
Chapter 3 Economic PrinciplesLearning Domain: An Introduction to the Mutual Funds Marketplace
The demand for blue widgets increases sharply due to a newspaper report that using blue widgets improves recovery from influenza. What can be said about the law of supply?
The law of supply dictates that when demand exceeds supply, prices rise, prompting producers to increase production to meet demand and maximize profits. The feedback from the document states:"The law of supply states that when demand is greater than supply, the price increases, and producers increase production to meet demand and maximize profit."
If the Consumer Price Index (CPI) was 140.6 last year and 146.9 this year, what was the inflation rate over the year?
Answer(s): C
The inflation rate is calculated by subtracting the previous year's CPI from the current year's CPI, dividing by the previous year's CPI, and multiplying by 100. In this case:(146.9 - 140.6) / 140.6 = 6.3 / 140.6 0.0448 or 4.48%.The feedback from the document confirms:"To calculate the rate of inflation over a period of time one must subtract the CPI at the beginning of the period from the CPI at the end of the period and then divide the result by the CPI at the beginning of the period. In this example, the solution can be derived as follows: (146.9 - 140.6) / 140.6."
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