ACI ACI Certifications 3I0-012 Questions & Answers

• Question 131:

  You buy a 181-day 2.75% CD with a face value of USD 1,500,000 at par when it is issued. You sell it in the secondary market after 150 days at 2.60%. What is your holding period yield?

  A. 2.60%

  B. 2.75%

  C. 2.775%

  D. 2.813%

  Correct Answer: C

• Question 132:

  You have quoted your customer the following eurodollar deposit rates:

  1M 5.375-25% 2M 5.4375-3125% 3M 5.5-375%

  The customer says, "I give you USD 20 million in the two's". What have you done?

  A. Borrowed USD 20 million at 5.3125%

  B. Lent USD 20 million at 5.4375%

  C. Borrowed USD 20 million at 5.4375%

  D. Lent USD 20 million at 5.3125%

  Correct Answer: A

• Question 133:

  Using the following rates:

  3M (90-day) eurodeposits3.50%

  6M (180-day) eurodeposits3.75%

  What is the rate for a deposit, which runs from 3 to 6 months?

  A. 3.625%

  B. 3.285%

  C. 3.965%

  D. 3.835%

  Correct Answer: C

• Question 134:

  Click on the Exhibit Button to view the Formula Sheet. A 6-month (182-day) investment of CHF15.5 million yields a return of CHF100,000. What is the rate of return?

  A. 1.32%

  B. 1.29%

  C. 1.28%

  D. 0.65%

  Correct Answer: C

• Question 135:

  A 3-month (91-day) deposit of EUR25 million is made at 3.25%. At maturity, it is rolled over three times at 3.55% for 90 days, 4.15% for 91 days and 4.19% for 89 days. At the end of 12 months, how much is repaid (principal plus interest)?

  A. EUR 25,962,011.01

  B. EUR 25,959,714.91

  C. EUR 25,948,878.47

  D. EUR 25,948,648.82

  Correct Answer: A

• Question 136:

  What is meant by "short dates"?

  A. Maturities of less than one week.

  B. Maturities of less than one month.

  C. Maturities of less than one year.

  D. Maturities in the same calendar month.

  Correct Answer: B

• Question 137:

  In all dealing conversations, the Model Code strongly recommends:

  A. Dealers stick to market terminology in order to avoid the impression that they are offering an advisory or fiduciary role.

  B. Dealers clarity what is being proposed rather than using any terminology that could be misinterpreted.

  C. Dealers restrict themselves to terminology listed and explained in Chapter 11 of the Model Code.

  D. Dealers define complex terminology in the confirmation of a deal.

  Correct Answer: B

• Question 138:

  If a broker refers to "the payer of 5-year euro at 4.12", what is this party doing?

  A. Paying a fixed rate of 4.12% per annum on a 30/360 basis over 5 years in euros through an interest rate swap in exchange for receiving a floating rate of 6-month Euribor on an actual/360 basis reset semi-annually and paid in arrears.

  B. Paying a fixed rate of 4.12% per annum on an actual/actual basis over 5 years in euros through an interest rate swap in exchange for receiving a floating rate of 6-month Euribor on an actual/360 basis reset semi-annually and paid in arrears.

  C. Paying a 5-year euro deposit and receiving a rate of interest of 4.12% on an actual/360 basis. Taking a 5-year euro deposit and paying a rate ol interest of 4.12% on an actual/360 basis.

  Correct Answer: A

• Question 139:

  A dealer has indicated his intention of assigning an interest rate swap to a third party soon after transacting that swap. When about to execute an assignment

  A. The dealer is entitled to provide the name of the original counterparty to the assignee.

  B. The dealer is entitled to provide the name of the assignee to the original counterparty.

  C. The dealer should seek the permission of the assignee before releasing the name to the original counterparty.

  D. The dealer should seek the permission of the original counterparty before releasing the name to the assignee.

  Correct Answer: C

• Question 140:

  What does the Model Code say about netting?

  A. Market participants are strongly recommended to net bilateral transactions with counterparties where activity justifies it.

  B. Market participants should establish payments netting agreements with cross-border counterparties where activity justifies it.

  C. Market participants should establish legally viable bilateral netting agreements with counterparties where activity justifies it.

  D. Market participants should establish legally viable multilateral netting agreements where activity justifies it.

  Correct Answer: C