3I0-012

3I0-012 practice questions, page 16 of 30, with answer review and explanations.

Question 76

What ought to be done in the event a trade erroneously occurs at an off-market rate?

  1. By agreement between the two counterparties, the trade must be cancelled as soon as practically possible since a rate amendment is prohibited.
  2. By agreement between the two counterparts, the trade should, as soon as practically possible, either be cancelled or have its rate amended to an appropriate market rate.
  3. The off-market rate should be adjusted as soon as possible to the appropriate current market rate and a new authenticated SWIFT confirmation sent immediately to the counterparty.
  4. Nothing need be done, since once a trade is agreed to by the front office it is a binding agreement for both counterparties.

Question 77

How long does the Model Code recommend that tapes and other records of dealers/brokers be kept?

  1. at least two months
  2. one year
  3. up to one month
  4. at least three months

Question 78

What is the meaning of “under reference” in the terminology of trading?

  1. a term the quoting dealer uses to caution the receiver of the quote that the price may have to be re-quoted at the receiver’s risk
  2. the qualification that the rate quoted in the market may no longer be valid and requires confirmation before any trades can be agreed upon
  3. the statement that the rates quoted by the broker are for indication only
  4. an acknowledgement by the dealer receiving the quote that the rate may have to be re-quoted at the receiver’s risk

Question 79

You request use of funds from your agent bank for 1 day on an amount of EUR 100,000,000.00, EONIA was 0.812% and the ECB deposit facility rate is 0.50%. What use of funds settlement amount should you expect?

  1. EUR 1,388,89
  2. EUR 1,561.11
  3. EUR 2,255.56
  4. EUR 2,951.39

Question 80

If the value date of a forward USD/JPY transaction is declared a holiday in either New York or Tokyo, the correct value date will be:

  1. the value date of the financial centre that is open
  2. the next business day of the financial centre which is closed
  3. the next business day when both New York and Tokyo are open
  4. the previous business day when both New York and Tokyo are open