|
Q12. The term notional principal refers to:
A) the period of time involved.
B) the amount swapped.
C) the cash interest payment.
Q13. Consider a commercial bank with a portfolio of U.S. Treasury bonds. Why would the bank wish to engage in a swap contract? As the:
A) U.S. dollar decreases, the value of the bonds decreases.
B) interest rate decrease, the value of the bonds decreases.
C) interest rate increases, the value of the bonds decreases.
Q14. Jan Jurgen, CFA charterholder, recently accepted a position in the Treasury area of a conservatively managed commercial bank. Jurgen intends to suggest the use of plain-vanilla interest rate swaps at today’s Asset & Liability Management Committee meeting. Jurgen is least likely to argue that the use of interest rate swaps will:
A) create arbitrage profits by exploiting market inefficiencies.
B) avoid costly regulations.
C) reduce the exposure from the mismatch between floating rate assets and fixed rate liabilities.
Q15. Parties agreeing to swap cash flows are:
A) counterparties.
B) swap facilitators.
C) agents.
Q16. Consider a U.S. investor who has a portfolio of Australian government bonds that are denominated in Australian dollars. Why would the investor wish to enter into a swap contract? As the:
A) Australian dollar increases in value, the interest payments from the Australian bonds translate into fewer U.S. dollars.
B) Australian dollar decreases in value, the interest payments from the Australian bonds translate into fewer U.S. dollars.
C) Australian interest rate decreases, the value of the Australian bonds decreases.
Q17. Which of the following statements about swaps is least accurate?
A) The notional principal is swapped at the beginning and end of a currency swap.
B) The notional principal is swapped at the beginning of an interest rate swap.
C) Motivations to engage in swaps include reducing transaction costs and maintaining privacy.
| 
发表于 2009-3-2 11:11
| 
