ACI 3I0-008 Online Practice Questions and Exam Preparation

ACI 3I0-008 Online Questions & Answers

• Question 301:

  Click on the Detail Button to view the Formula Sheet. What is the effect of netting?

  A. To reduce the number and size of payments and transfers
  B. To reduce exposure to credit risk
  C. To reduce the size of the balance sheet
  D. All of the above
  D. All of the above

• Question 302:

  Click on the Detail Button to view the Formula Sheet. What is the purpose of an initial margin on a futures exchange?

  A. To cover losses incurred between variation margin payments
  B. To exclude retail investors
  C. To pay reserve requirements
  D. To cover fees due to the clearing house
  A. To cover losses incurred between variation margin payments

• Question 303:

  Click on the Detail Button to view the Formula Sheet. If you buy GBP 2,000,000 against USD at 1.6020; GBP 1,000,000 at 1.6035 and GBP 3,000,000 at 1.6028, what is the average rate of your position?

  A. 1.6035
  B. 1.6027
  C. 1.6030
  D. 1.6023
  B. 1.6027

• Question 304:

  Click on the Detail Button to view the Formula Sheet. You deal over the phone with a counterparty. The subsequent confirmation differs from the terms agreed verbally. What is the result?

  A. The confirmation takes precedence as it is a written contract.
  B. The matter will have to be submitted to arbitration in order to establish the mutual intent of the parties.
  C. It depends on local law.
  D. The verbal agreement is binding.
  D. The verbal agreement is binding.

• Question 305:

  Click on the Detail Button to view the Formula Sheet. Which of the following statements reflects the Model Code on gambling or betting amongst market participants?

  A. Gambling and betting between market participants should be strongly discouraged.
  B. Gambling and betting between market participants can be allowed if it is monitored by management.
  C. Gambling and betting between market participants should be forbidden.
  D. All of the above.
  A. Gambling and betting between market participants should be strongly discouraged.

• Question 306:

  Click on the Detail Button to view the Formula Sheet. The intrinsic value of a long call option:

  A. Falls and rises with the price of the underlying commodity, but is always positive
  B. Rises if the price of the underlying commodity falls and vice versa
  C. Depends solely on the volatility of the price of the underlying commodity
  D. Becomes negative if the market price of the underlying commodity falls below the strike price of the option
  A. Falls and rises with the price of the underlying commodity, but is always positive

• Question 307:

  Click on the Detail Button to view the Formula Sheet. Making interest rate swap transactions subject to agreement on documentation:

  A. Is recommended where the complications of the transaction warrant the practice.
  B. Is strictly forbidden.
  C. Is considered bad practice.
  D. Must have senior management approval.
  C. Is considered bad practice.

• Question 308:

  Click on the Detail Button to view the Formula Sheet. If EUR/USD is 1.1025-28 and the 6-month swap is 112.50/113, what is the 6-month outright price?

  A. 1.1380-1.11405
  B. 1.11375-1.1141
  C. 1.09125-1.0915
  D. None of these
  B. 1.11375-1.1141

• Question 309:

  Click on the Detail Button to view the Formula Sheet. How can material divergences between the value of cash and collateral be managed in a documented sell/buy-back?

  A. Margin maintenance
  B. Re-pricing
  C. Either of the above, but usually (a)
  D. Either of the above, but usually (b)
  D. Either of the above, but usually (b)

• Question 310:

  Click on the Detail Button to view the Formula Sheet.

  You are quoted the following market rates:

  spot EUR/CHF 1.1005

  6M (180-day) EUR 3.45%

  6M (180-day) CHF 1.25%

  What are the 6-month EUR/CHF forward points?

  A. +121
  B. +120
  C. -116
  D. -119
  D. -119