AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 311:

  The U.S. Congress establishedthe.

  A. UCC.
  B. FinCEN.
  C. OCC.
  D. OFAC.
  C. OCC.

• Question 312:

  The yield on any short-term investment instrument is a function of the maturity or holding period, the amount paid and:

  A. the cash flows received.
  B. the money market yield.
  C. the after-tax yield.
  D. the issuing price.
  A. the cash flows received.

• Question 313:

  The future value of $60 invested at 8% compounded per year for three years is:

  A. $47.63.
  B. $64.80.
  C. $74.40.
  D. $75.58.
  D. $75.58.

• Question 314:

  Which statement is true about credit unions?

  A. They offer lending rates similar to other financial institutions.
  B. They are not-for-profit organizations.
  C. Their deposits are insured by the FDIC.
  D. They can only be chartered by state agencies.
  B. They are not-for-profit organizations.

• Question 315:

  An organization must maintain adequate liquidity to meet:

  A. strategic objectives.
  B. five year plan.
  C. transaction requirements.
  D. defined contribution plan distributions.
  C. transaction requirements.

• Question 316:

  A U.S. company that is expecting to receive a payment of C$1,000,000 purchased a put option of C$1,000,000 at a strike price of 1.75 C$/US$. Two days before the receipt of the payment, the spot rate is 1.85 C$/US$. To maximize its receipt of dollars, the company should do which of the following?

  A. Let the put option expire.
  B. Exercise its put option.
  C. Purchase a call option at 1.85.
  D. Purchase a spot contract at 1.85.
  B. Exercise its put option.

• Question 317:

  Compared to debt, which of the following statements is true about a company issuing equity?

  A. Its shareholders assume less risk than its creditors.
  B. The payment of interest on debt is not tax deductible.
  C. The payment of dividends on common stock is a legal obligation.
  D. It is more expensive.
  D. It is more expensive.

• Question 318:

  An accounts receivable manager has been asked to accelerate cash into her company by offering trade discount terms to its customers. Her company's cost of capital is 11%. If she offers terms of 2/10, net 30 on a $50,000 invoice, what is the present value to the company if the customer accepts the discount and pays early?

  A. $48,852
  B. $48,366
  C. $48,121
  D. $47,996
  A. $48,852

• Question 319:

  Which of the following methods of compensation is NOT used by banks in the United States?

  A. Account service fees
  B. Value dating
  C. Wire charges
  D. Check clearing charges
  B. Value dating

• Question 320:

  ABC Company is an energy-holding company which owns a number of regulated power utilities that have monopolies in different regions. The majority of the holding company's income is realized from investment portfolios. The company has done well and is going to report its overallperformance to the public. What performance evaluation processes should management use to measure portfolio performance?

  A. Benchmarking against competitors
  B. Establishing market index benchmarks
  C. Calculating the total return of the portfolio
  D. Determining the return on equity of the company
  B. Establishing market index benchmarks