ACI 3I0-012 Exam Questions Free Practice Test

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Viewing questions 121-135 out of questions

Questions # 121:

A put option is ‘out-of-the-money’ if:

Options:

Its strike price is higher than the current market price of the underlying commodity

If the current market price of the underlying commodity is higher than the strike price of the option

Its strike price is equal to the current market price of the underlying commodity

If the current market price of the underlying commodity is lower than the strike price of the option

Expert Solution

Questions # 122:

Which of the following is true?

Options:

The 3-month EURODOLLAR futures contract has a basis point value of USD 50.00 and a face value of USD 1,000,000.00

The 3-month EURIBOR futures contract has a a basis point value of EUR 12.50 and a face value of EUR 500,000.00

The 3-month Sterling (SHORT STERLING) futures contract has a a basis point value of GBP 12.50 and a face value of GBP 500,000.00

The 3-month Euro Swiss Franc (EUROSWISS) futures contract has a a basis point value of CHF 50.00 and a face value of CHF 2,000,000.00

Expert Solution

Questions # 123:

The use of standard settlement instructions (SSI’s) is strongly encouraged because:

Options:

it reduces operational risk

it splits differences arising from failed settlement between the two counterparties

it removes the need for sending out SWIFT confirmations

the use of SSI’s secures the trading on more secure platforms

Expert Solution

Questions # 124:

EURODOLLAR futures are:

Options:

Traded on the Chicago Mercantile Exchange (CME Group) and have a face value of USD 500,000.00

Traded on the Intercontinental Exchange (ICE) and have a face value of USD 1,000,000.00

Traded on the Intercontinental Exchange (ICE) and have a face value of USD 500,000.00

Traded on the Chicago Mercantile Exchange (CME Group) and have a face value of USD 1,000,000.00

Expert Solution

Questions # 125:

What is the correct interpretation of a EUR 2,000,000.00 overnight VaR figure with a 97% confidence level?

Options:

A loss of at least EUR 2,000,000.00 can be expected in 97 out of the next 100 days.

A loss of at most EUR 2,000,000.00 can be expected in 3 out of the next 100 days.

A loss of at least EUR 2,000,000.00 can be expected in 3 out of the next 100 days.

A loss of at most EUR 2,000,000.00 can be expected in 6 out of the next 100 days.

Expert Solution

Questions # 126:

A 3-month (91-day) deposit of AUD 25,000,000.00 is made at 3.25%. At maturity, it is rolled over three times at 3.55% for 90 days, 4.15% for 91 days and 4.19% for 89 days. At the end of 12 months, how much is repaid (principal plus interest)?

Options:

AUD 25,962,011.00

AUD 25,959,714.91

AUD 25,948,878.47

AUD 25,948,648.82

Expert Solution

Questions # 127:

A 30-day 4% CD with a face value of GBP 20,000,000.00 is trading in the secondary market with 20 days remaining to maturity at 4.05%.

What would be your holding period yield if you bought the CD now and held it to maturity?

Options:

4.05%

4.0%

3.891%

3.838%

Expert Solution

Questions # 128:

Which type of repo is the most risky for the buyer?

Options:

Delivery repo

HIC repo

TO-party repo

There is no real difference

Expert Solution

Questions # 129:

In spite of having agreed to a deal, dealers are not bound to the deal if it is subject to documentation. The Model Code:

Options:

Does not regard this as a good practice.

Urge dealers to be bear this in mind, as this is common practice for capital market deals.

Does not comment on this matter.

Recommends that national ACI Associations deal with this according to their local customs.

Expert Solution

Questions # 130:

Purchasing a USD/JPY call option is equivalent to:

Options:

Selling an JPY/USD put option

Selling a JPY/USD call option

Purchasing an JPY/USD put option

None of the above

Expert Solution

Questions # 131:

You need to buy USD 5,000,000 against GBP and are quoted the following rates concurrently by two separate banks: 1.6045-50 and 1.6047-52. At which rate do you trade?

Options:

1.6045

1.6047

1.6050

1.6052

Expert Solution

Questions # 132:

At the end of the day you are short EUR 10 million against GBP at 0.6712. You are asked to revalue your position at a EUR/GBP rate of 0.6729. What is the resulting profit or loss?

Options:

Loss of GBP 17000

Profit of GBP 17,000

Loss of EUR 17,000

Profit of EUR of 17,000

Expert Solution

Questions # 133:

Click on the Exhibit Button to view the Formula Sheet. If you bought USD 2,000,000 against CHF at 1.1020, USD 3,000,000 at 1.1040 and USD 5,000,000 at 1.1032, what is the average rate of your position?

Options:

1.1030

1.1035

1.1028

1.1032

Expert Solution

Questions # 134:

The Model Code recommends that when banks accept a stop-loss order

Options:

Management must ensure ongoing lines of communication are in place between the parties.

Management must report to the central bank.

Management allows only experienced dealers to take such orders.

Bank staff must secure the approval of the counterpartqs management to accept such orders.

Expert Solution

Questions # 135:

Which of the following is true?

Options:

The Euronext.LIFFE short sterling futures contract has a tick value of GBP 12.50 and a face value of GBP 1,000,000

The Euronext.LIFFE JPY futures contract has a tick value of JPY 2,500 and a face value of JPY 1,000,000,000

The CME eurodollar futures contract has a minimum price interval of one-quarter tick

(0.0025) for the nearest contract

All of the above

Expert Solution

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