CIMA Exam CIMAPRA17-BA1-1 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:

ATreasury bills to the banking sector

BLong-term securities to insurance companies and pension funds

CNational savings securities to the general public

DLong-term securities to the banking sector

Show Suggested Answer

Suggested Answer: C

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

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Oretha

10 hours 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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Silvana

6 days 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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Carmela

11 days 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

13 days 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

14 days ago

Option D, definitely! Borrowing from the banking sector is like pouring gasoline on the fire of inflation.

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Rolland

20 days ago

I think the sale of Treasury bills to the banking sector is most likely to be inflationary.

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