AFP AFP-CTP Online Practice Questions and Exam Preparation

AFP AFP-CTP Online Questions & Answers

• Question 831:

  Which of the following statements is typically true about a net settlement system?

  A. It significantly reduces the total cost of transfers.
  B. Participants obtain improved payment terms from suppliers.
  C. Receivables and payments are continuously settled 1-to-1.
  D. An independent third party determines the settlement dates.
  A. It significantly reduces the total cost of transfers.

• Question 832:

  For newly issued debt, a company's effective cost of debt is a function of yield to maturity and:

  A. the credit rating of the company.
  B. the marginal tax rate of the company.
  C. the maturity date of the debt instrument.
  D. the price of the debt instrument.
  B. the marginal tax rate of the company.

• Question 833:

  Upon entering into an interest rate swap with a notional principal of $10,000,000, what is the initial amount of money the counterparties must exchange at the beginning of the swap?

  A. $0
  B. $5,000,000
  C. The future value of $10,000,000
  D. $10,000,000 discounted
  A. $0

• Question 834:

  The Treasury Manager is forecasting sales based on historical data. It was observed that sales decreased sharply in December last year, normally a high sales volume period. Further investigation indicated that a severe winter storm was experienced across the Southeastern United States. How should this event be classified in the forecast when considering the sales trends?

  A. Random movement
  B. Stationary series
  C. Cyclical pattern
  D. Seasonal pattern
  A. Random movement

• Question 835:

  A U.S. government agency issues securities transfers using Fedwire Book-Entry Securities System. The first transfer request of the day in the amount of $1 million is sent at 1:00 p.m. EST, the second one for $2 million at 3:30 p.m. EST, the third one for $3 million at 4:30

  A. m. EST and the fourth one for $4 million at 5:00 p.m. EST, all on the same day. Which of the following represents the total value transferred at 5:00 p.m. EST that day?
  B. $1 million
  C. $3 million
  D. $6 million
  E. $10 million
  A. m. EST and the fourth one for $4 million at 5:00 p.m. EST, all on the same day. Which of the following represents the total value transferred at 5:00 p.m. EST that day?

• Question 836:

  To arrive at the closing cash position, a cash manager must add the expected settlements in the collection and concentration accounts and deduct the projected disbursement totals from the:

  A. opening available balance.
  B. closing ledger balance.
  C. opening ledger balance.
  D. closing investment account balance.
  A. opening available balance.

• Question 837:

  A portfolio manager wishes to make a short-term investment. His investment policy requires that short-term investments be low risk and secured, have a fixed interest rate and be highly liquid/redeemable prior to maturity. Which of the following should the manager choose?

  A. Asset-backed commercial paper
  B. Bank obligations
  C. Commercial paper
  D. Government treasury bills
  A. Asset-backed commercial paper

• Question 838:

  The main objective of a company's international cash management function is to:

  A. reduce cross-border fund transfers.
  B. collect and disburse cash.
  C. optimize global cash resources.
  D. minimize foreign exchange risk.
  C. optimize global cash resources.

• Question 839:

  Examples of fixed assets include which of the following?

  I. Inventory

  II. Treasury bills

  III. Forklift

  IV.

  Goodwill

  A. III only
  B. I and III only
  C. I, II, and IV only
  D. I, III, and IV only
  I. Inventory II. Treasury bills III. Forklift IV. Goodwill
  A. III only

• Question 840:

  A trader of ABC Bank executed and audited his own trades. Assigning these two functions to the same person introduced which one of the following risks to the bank?

  A. Operational risk
  B. Currency risk
  C. Derivatives risk
  D. Regulatory risk
  A. Operational risk