AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 351:

  Buying a security with the intent of selling it prior to its maturity date to increase the return is an example of:

  A. active investment strategy.
  B. matching investment strategy.
  C. an interest rate future.
  D. a diversification program.
  A. active investment strategy.

• Question 352:

  A cash manager wants to convert wire payments to ACH. Which of the following would NOT be a good application for ACH?

  A. Routine loan payments
  B. Lease payments
  C. Same day payments
  D. Future tax payments
  C. Same day payments

• Question 353:

  Which of the following is NOT a consideration for treasury managers when implementing electronic communications with FSPs?

  A. Cost limitations
  B. Security concerns
  C. Physical location of FSP
  D. Telecommunications infrastructure
  C. Physical location of FSP

• Question 354:

  The PRIMARY difference between defined benefit and defined contribution pension plans is whether the employee or the employer:

  A. receives the tax reduction benefits of the plan.
  B. decides which mutual funds are included in the plan.
  C. bears risk of a shortfall of the investment results in the plan.
  D. hires investment managers for the plan.
  C. bears risk of a shortfall of the investment results in the plan.

• Question 355:

  A large, nation-wide, retailer of plumbing fixtures is considering implementing ACH technology to improve its accounts receivable processing. Which of the following pre- authorized ACH transactions can the company use for this application?

  A. ARC (Accounts Receivable Conversion)
  B. CIE (Customer-Initiated Entry)
  C. TEL (Telephone-Initiated Entry)
  D. WEB (Internet-Initiated Entry)
  B. CIE (Customer-Initiated Entry)

• Question 356:

  A short-term bank line with $20 million of unused capacity and an investment in an overnight money market fund are both forms of which liquidity requirement?

  A. Precautionary
  B. Strategic
  C. Opportunity
  D. Transaction
  A. Precautionary

• Question 357:

  Capital budgeting decisions are most commonly evaluated in terms of:

  A. earnings allowance rate.
  B. internal rate of return.
  C. yield to maturity.
  D. financial leverage.
  B. internal rate of return.

• Question 358:

  Examples of traditional factors used in making a credit decision include which of the following?

  I. Capacity

  II. Capital

  III. Compliance

  IV.

  Character

  A. IV only
  B. I and III only
  C. I, II, and IV only
  D. I, II, III, and IV
  I. Capacity II. Capital III. Compliance IV. Character
  C. I, II, and IV only

• Question 359:

  In order to increase liquidity, ABC Motor Company bundled its customers' installment payments and resold them to other investors. This is known as: A. factoring.

  B. securitization.
  C. reclassification.
  D. secondary distribution.
  B. securitization.

• Question 360:

  The Treasurer of PJB Company is in charge of implementing new treasury management software. Without issuing any RFPs, the Treasurer hires a consulting company to install the software and program it to suit the company's needs. The Treasurer is responsible for approving the consultant's invoices for payment. Through conversation, the CFO discovered that the Treasurer's relative is one of the partners at the consulting company. The Treasurer was immediately terminated. What did the Treasurer MOST LIKELY violate?

  A. The corporate code of conduct
  B. Sarbanes-Oxley controls
  C. The Uniform Commercial Code
  D. Treasury operations procedures
  A. The corporate code of conduct