Pass 2016-FRR Exam with Updated 2016-FRR Exam Dumps PDF 2023 [Q19-Q34]

NO.19 Normally, commercial banking can be viewed as a fixed income carry trade since

NO.20 An asset-sensitive bank will have a ___ cumulative gap and will benefit from ___ interest rates.

NO.21 Which one of the following four statements correctly identifies disadvantages of using the economic capital?

NO.22 Which of the following statements regarding CDO-squared is correct?
I. CDO-squared use other CDOs and CMOs as collateral.
II. Risk assessment of CDO-squared is almost impossible due to their complexity.
III. CDO-squared have lower credit risk than CMOs but higher than CDOs.

NO.23 Which one of the following four physical commodities markets has the right combination of characteristics
that generally allows short selling in the market, without making the short-selling transaction prohibitively
expensive?

NO.24 What is a difference between currency swaps and interest rate swaps?

NO.25 Which of the following statements represents a methodological difference between variance-covariance and
full revaluation methods?

NO.26 Forward rate agreements (FRA) are:

NO.27 Which one of the four following statements about the Risk Adjusted Return on Capital (RAROC) is correct?
RAROC is the ratio of:

NO.28 Which one of the following is a reason for a bank to keep a commercial loan in its portfolio until maturity?
I. Commercial loans usually have attractive risk-return profile.
II. Commercial loans are difficult to sell due to non standard features.
III. Commercial loans could be used to maintain good relations with important customers.
IV. The credit risk in commercial loans is low.

NO.29 Which of the following measure describes the symmetry of a statistical distribution?

NO.30 Changes to which one of the following four factors would typically not increase the cost of credit?

NO.31 Securitization is the process by which banks
I. Issue bonds where the payment of interest and repayment of principal on the bonds depends on the cash flow
generated by a pool of bank assets.
II. Issue bonds where the bank has transferred its legal right to payment of interest and repayment of principal
to bondholders.
III. Sell illiquid assets.

NO.32 Alpha Bank estimates that the annualized standard deviation of its portfolio returns equal 30%; The daily
volatility of the portfolio is closest to which of the following?

NO.33 Which of the following bank events could stress the bank’s liquidity position?
I. Obligations to fund assets like mortgages
II. Unusually large depositor withdrawals
III. Counterparty collateral calls
IV. Nonperforming assets

NO.34 Which one of the following statements describes Macauley’s duration?