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CIMAPRA17-BA1-1 Exam - Topic 1 Question 84 Discussion

Which one of the following methods of government borrowing is most likely to be inflationary?The sale of:
C) National savings securities to the general public
A) Treasury bills to the banking sector
B) Long-term securities to insurance companies and pension funds
D) Long-term securities to the banking sector

CIMAPRA17-BA1-1 Exam - Topic 1 Question 84 Discussion

Actual exam question for CIMA's CIMAPRA17-BA1-1 exam
Question #: 84
Topic #: 1
[All CIMAPRA17-BA1-1 Questions]

Which one of the following methods of government borrowing is most likely to be inflationary?

The sale of:

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Suggested Answer: C

by Ryan at Apr 11, 2024, 03:34 AM

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Trinidad
9 months ago
Long-term securities usually aren't that risky for inflation.
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Jonelle
10 months ago
Really? I’m surprised D is the answer.
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Paola
10 months ago
I thought C could be inflationary too, though.
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Thaddeus
10 months ago
Totally agree, D makes sense!
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Ligia
10 months ago
D is the most inflationary option.
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Brice
10 months ago
I thought that selling to the general public (C) could also be inflationary, but now I’m questioning if it’s as impactful as the banking sector options.
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Ettie
11 months ago
I’m torn between B and D. I recall that long-term securities can have different effects depending on who buys them, but I can't remember which one is more inflationary.
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Talia
11 months ago
I feel like this question is similar to one we practiced where government borrowing impacts inflation. I think A could be the right choice since it involves the banking sector directly.
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Merlyn
11 months ago
I think the answer might be D, but I'm not completely sure. I remember something about how banks can create money when they buy long-term securities.
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Stefanie
11 months ago
I'm feeling pretty confident about this one. I think the sale of Treasury bills to the banking sector is the most inflationary, since that expands the money supply the most. The other options are less likely to have that kind of impact.
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Roselle
11 months ago
Okay, let's see. The sale of Treasury bills to the banking sector is likely to be the most inflationary, since that directly increases the money supply. The other options seem less likely to have that effect.
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Shawnee
11 months ago
Hmm, I'm a bit unsure about this one. I know the different borrowing methods have different effects, but I'm not totally clear on the specifics. Guess I'll have to think it through carefully.
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Lenna
11 months ago
This one seems pretty straightforward. I think the key is to focus on how the different borrowing methods impact the money supply and inflation.
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Izetta
11 months ago
This is a tricky one, but I think I can figure it out. I'll need to make sure I'm discounting the cash flows correctly and accounting for all the relevant costs. The sensitivity analysis part might be a bit trickier, but I'll give it my best shot.
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Elmer
11 months ago
The standard Data Classification report in option A might be a good starting point, but it sounds like the compliance team wants more granular details. I think option B or D would be the way to go to get that field-level information.
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Rozella
11 months ago
I'm a little confused by this question. I'm not sure if Outlook automatically creates Meetings or Contacts for messages. I'll have to think about this more.
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Hoa
11 months ago
The Managed, Defined, and Repeatable levels sound familiar, but I can't recall if Fundamental is a real one. I'll have to make an educated guess on this.
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Luz
1 year ago
Option A? More like 'Trea$ury bills to the banking $ector'. Inflation, here we come!
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Keneth
1 year ago
I think selling national savings securities to the general public can also lead to inflation.
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Cruz
1 year ago
C) National savings securities to the general public
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Val
1 year ago
Yeah, selling treasury bills to the banking sector can definitely be inflationary.
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Norah
1 year ago
A) Treasury bills to the banking sector
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Marget
1 year ago
Ah, the age-old question of which method of borrowing is the least inflationary. I'm just hoping the answer isn't 'All of the above'!
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Val
1 year ago
C) National savings securities to the general public
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Essie
1 year ago
B) Long-term securities to insurance companies and pension funds
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Florinda
1 year ago
A) Treasury bills to the banking sector
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Oretha
1 year ago
Hmm, B seems like the safest bet. Insurance companies and pension funds are less likely to go on a spending spree with those long-term securities.
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Bernadine
1 year ago
C) National savings securities to the general public
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Theola
1 year ago
B) Long-term securities to insurance companies and pension funds
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Lavera
1 year ago
A) Treasury bills to the banking sector
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Silvana
1 year ago
I'm going with C. Selling securities to the general public is less likely to stoke the flames of inflation, right?
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Sanjuana
1 year ago
D) Long-term securities to the banking sector
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Rolland
1 year ago
C) National savings securities to the general public
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Stevie
1 year ago
B) Long-term securities to insurance companies and pension funds
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Danica
1 year ago
A) Treasury bills to the banking sector
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Carmela
1 year ago
I see your point, Lynelle. Selling long-term securities to insurance companies and pension funds could lead to increased demand for credit, potentially causing inflation.
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Lynelle
1 year ago
I disagree, I believe the sale of long-term securities to insurance companies and pension funds could be more inflationary.
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Ardella
1 year ago
Option D, definitely! Borrowing from the banking sector is like pouring gasoline on the fire of inflation.
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Tiera
1 year ago
I agree, borrowing from the banking sector can lead to an increase in the money supply and drive up prices.
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Dana
1 year ago
Option D, definitely! Borrowing from the banking sector is like pouring gasoline on the fire of inflation.
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Rolland
1 year ago
I think the sale of Treasury bills to the banking sector is most likely to be inflationary.
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