8. What is a "sovereign wealth fund"?
A. A loan given to the private sector
B. A fund owned by a royal family
C. A government-owned investment fund from excess reserves
D. A type of business tax
Answer (1)
The answer is letter C. A government-owned investment fund from excess reservesA sovereign wealth fund is a savings fund owned by the government, built using money from natural resources or foreign currency reserves. These funds are usually invested in businesses, infrastructure, or foreign markets.The goal is to grow the country’s wealth for future generations. However, it must be carefully managed to avoid misuse. Malaysia’s 1MDB scàndal is an example of how such funds can be abused without strong safeguards.
