Free Download 3I0-012 Examp Dump: ACI.3I0-012.PracticeTest.2018-05-25.440q.vcex

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Question 1

An option contract that gives the buyer the right to exercise the option at several distinct points during its life is called:

Correct answer: C

Question 2

When considering interest rate risk in the banking book, retail demand deposits without fixed contractual maturity:

should be assumed to have zero duration
should be treated like other instantly variable rate liabilities, such as overnight money market borrowing.
should be assumed to have a low correlation with money market reference rates
represent a minor contributor to interest rate risk and can safely be disregarded

Correct answer: C

Question 3

If the duration gap is zero, how will a small parallel shift in interest rates affect the market value of the bank’s equity?

Correct answer: C

Question 4

Which of the following statements is correct regarding duration?

Correct answer: D

Question 5

Using reprising gap analysis, a bank’s balance sheet is considered liability-sensitive to market interest rate changes, if:

Correct answer: A

Question 6

Which of the following statements about the Liquidity Coverage Ratio is correct?

The LCR is a measure to ensure that the reserve of high quality liquid assets is sufficient to cover short term demand for liquidity in a stress situation.
the ratio (cash outflow in a 30-day stress period divided by high quality liquid assets) has to be greater than 100%.
Covered bonds are class 1 assets.
Obligations issued by central banks or government agencies are class 2 assets.

Correct answer: A

Question 7

Which one of the following statements about mark-to-model valuation is correct?

Mark-to-model valuation is used for exchange-traded positions to ensure correct pricing.
Asset managers are not allowed to use mark-to-model valuation.
Mark-to-model valuation is used for complex financial instruments; it is always accurate and in line with potential tradable prices.
Mark-to-model valuation refers to prices determined by financial models, rather than actual market prices.

Correct answer: D

Question 8

A closed position in a particular foreign currency exists:

when the net spot position plus the forward position plus the delta equivalent of the foreign currency options book add up to zero
when the forward purchases of a foreign currency are equivalent to the equity position in that same currency
when the reverse repurchases of foreign currency are equal to the forward purchases of the functional currency
when the maturity structure of the assets in one currency is closely matched to the maturity structure of liabilities in another

Correct answer: A

Question 9

Which of the following are all goals of the originator of securitized assets?

to increase funding diversification , to reduce funding costs, to achieve regulatory and accounting benefits, to increase the size of the balance sheet
to increase funding diversification , to reduce funding costs, to achieve regulatory and accounting benefits
to increase funding diversification , to reduce operational risk, to achieve regulatory and accounting benefits, to decrease the size of the balance sheet
to increase funding diversification , to reduce operational risk, to achieve regulatory and accounting benefits, to increase the size of the balance sheet

Correct answer: B

Question 10

Which of the following risks are considered market risks?