logo

CuriousTab

CuriousTab

Discussion


Home Interview Accounting and Finance See What Others Are Saying!
  • Question
  • What is an example of an inflation risk?


  • Correct Answer
  • Inflation risk, also called purchasing power risk, is the chance that the cash flows from an investment won't be worth as much in the future because of changes in purchasing power due to inflation HOW IT WORKS (EXAMPLE): For example, $1,000,000 in bonds with a 10% coupon might generate enough interest payments for a retiree to live on, but with an annual 3% inflation rate, every $1,000 produced by the portfolio will only be worth $970 next year and about $940 the year after that The rising inflation means that the interest payments have less and less purchasing power And the principal, when it is repaid after several years, will buy substantially less than it did when the investor first purchased the bonds 

  • Tags: Analyst, Bank Clerk, Bank PO

    More questions

    • 1. What is CRR rate?
    • Discuss
    • 2. Which among the following are not access Specifiers in C++?

    • Options
    • A. Public
    • B. Protected
    • C. Default
    • D. Private
    • Discuss
    • 3. In which year, the first bank of India "Bank of Hindustan" was established ?

    • Options
    • A. 1677
    • B. 1770
    • C. 1796
    • D. 1831
    • Discuss
    • 4. What could be the bucket size if collision and overlapping occur at same time?

    • Options
    • A. 2
    • B. 0
    • C. 1
    • D. 4
    • Discuss
    • 5. Default constructor accepts how many arguments?

    • Options
    • A. one
    • B. two
    • C. three
    • D. None
    • Discuss
    • 6. What are the mandatory part to present in function pointers?

    • Options
    • A. &
    • B. retrun values
    • C. data types
    • D. none of these
    • Discuss
    • 7. Which of the following can derived class inherit?

    • Options
    • A. members
    • B. functions
    • C. both a & b
    • D. None of the above
    • Discuss
    • 8. What kind of object is modifying sequence algorithm?

    • Options
    • A. Function template
    • B. Class template
    • C. Method
    • D. None of these
    • Discuss
    • 9. Fixed Foreign Exchange rate can be changed by

    • Options
    • A. SEBI
    • B. Ministry of Finance
    • C. RBI
    • D. All of the above
    • Discuss
    • 10. The shortcut key to quit from tally is

    • Options
    • A. CTRL + Q
    • B. CTRL + ESC
    • C. CTRL + T
    • D. CTRL + P
    • Discuss


    Comments

    There are no comments.

Enter a new Comment