ACI 3I0-012 Online Practice Questions and Exam Preparation

ACI 3I0-012 Online Questions & Answers

• Question 681:

  What does the Model Code advise regarding the taping of telephone conversations?

  A. The tapes and other records should be kept until the transaction has been settled B. Firms should ensure that they comply with local privacy laws
  B. Management should ensure that the installation and control of recording equipment complies with local legislation, including laws on data protection, privacy and human rights as well as the manufacturers minimum requirements
  C. All front office personnel should have access to these tapes and records
  B. Management should ensure that the installation and control of recording equipment complies with local legislation, including laws on data protection, privacy and human rights as well as the manufacturers minimum requirements

• Question 682:

  What type of risk would describe the failure of a back office to make adequate margin calls on repo positions?

  A. Credit risk
  B. Market risk
  C. Operational risk
  D. Settlement risk
  C. Operational risk

• Question 683:

  A put option is `out-of-the-money' if:

  A. Its strike price is higher than the current market price of the underlying commodity
  B. If the current market price of the underlying commodity is higher than the strike price of the option
  C. Its strike price is equal to the current market price of the underlying commodity
  D. If the current market price of the underlying commodity is lower than the strike price of the option
  B. If the current market price of the underlying commodity is higher than the strike price of the option

• Question 684:

  Which statement about modern matched-maturity transfer pricing in banks is correct?

  A. It is now a widely accepted standard that banks should use a single representative transfer price across the entire maturity spectrum.
  B. Modern matched-maturity pricing systems include an additional liquidity surcharge that is specifically applied to more liquid short maturities.
  C. Matched-maturity transfer prices should represent a weighted average cost of capital that incorporates the cost of equity into the cost of borrowed funds.
  D. Modern matched-maturity systems differentiate transfer prices by the maturity of the commitment and also apply a marginal funding cost perspective.
  D. Modern matched-maturity systems differentiate transfer prices by the maturity of the commitment and also apply a marginal funding cost perspective.

• Question 685:

  If 6-month EUR/AUD is quoted at 29/32, which of the following statements is correct?

  A. EUR rates are higher than AUD rates in the 6-month
  B. AUD rates are higher than EUR rates in the 6-month
  C. There is a positive EUR yield curie
  D. There is not enough information to decide
  B. AUD rates are higher than EUR rates in the 6-month

• Question 686:

  An interest rate swap (IRS) is:

  A. A contract to exchange one stream of interest payments for another
  B. A temporary exchange of one deposit for another of a longer maturity in the same currency
  C. A forward-forward contract
  D. A contract to exchange an interest rate stream in one currency for another one in a different currency
  A. A contract to exchange one stream of interest payments for another

• Question 687:

  Which one of the following statements is incorrect? Hedge accounting of an existing position no longer applies when:

  A. the trader acquires additional exposure in the hedged item.
  B. the hedging instrument is sold, terminated or exercised.
  C. the hedged item is sold or settled.
  D. a hedge fails the effectiveness test.
  A. the trader acquires additional exposure in the hedged item.

• Question 688:

  If several banks hit a broker simultaneously for an amount greater than the amount for which the price was shown:

  A. no transaction is done
  B. the broker has to honor each and every amount hit
  C. the broker has to split the amount among the banks on a pro rata basis
  D. the broker may freely choose the bank(s) he will deal with
  C. the broker has to split the amount among the banks on a pro rata basis

• Question 689:

  Prudential regulation of banking book liquidity risk is dealt with by the Basel Committee (Basel II / Basel III) in the context of:

  A. capital adequacy regulations in Pillar 1
  B. market risk and Tier 3 capital elements
  C. internal management procedures subject to supervisory review in Pillar 2
  D. market discipline, disclosure and transparency in Pillar 3
  B. market risk and Tier 3 capital elements

• Question 690:

  What is the Repurchase Price of a classic repo?

  A. The market value of bond collateral at the end of the repo at the clean price of the bond
  B. The market value of bond collateral at the end of the repo at the dirty price of the bond
  C. The amount of cash actually paid for collateral at the start of the repo
  D. The amount of cash actually paid for collateral at the start of the repo plus repo interest
  D. The amount of cash actually paid for collateral at the start of the repo plus repo interest