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LOS k: Demonstrate the use of exposure limits, marking to market, collateral, netting arrangements, credit standards, and credit derivatives to manage credit risk.
Q1. When two counterparties have obligations to each other, the process that potentially reduces the credit risk of one counterparty to zero and lowers the credit risk of the other is known as:
A) marking to market.
B) netting.
C) collateralizing.
Q2. A subsidiary of a parent company that is capitalized in a way that results in a high credit rating, with the objective of allowing the subsidiary to engage in activities where a high credit rating is an advantage would be called:
A) collateralization.
B) a collateral mortgage obligation.
C) a special purpose vehicle.
Q3. The practice that imposes current credit risk on a periodic basis to lower potential credit risk is called:
A) netting.
B) marking to market.
C) potentiality. | 
发表于 2009-4-7 18:54
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