3I0-013

3I0-013 practice questions, page 9 of 16, with answer review and explanations.

Question 41

Which of the following statements best describes collateral?

  1. Liquid assets pledged by one or both counterparties to the other to reduce credit risk
  2. Deposits placed by a commercial bank with a central bank to fulfill reserve asset ratios
  3. Any deposit placed by an institution with another institution of a lower credit rating
  4. Any cross border payment of currency

Question 42

In the absence of his normal dealer contact, a counterparty calls the back office and asks the clerk for his opinion about how long his money should be placed on deposit. What action should the back office clerk take?

  1. He should give his opinion.
  2. He should give his opinion and tell the counterparty that he is not qualified to do so.
  3. He should tell the counterparty that he is not qualified to give an opinion and refer the counterparty to another dealer.
  4. He should give his opinion and refer the counterparty to another dealer.

Question 43

A middle or back office clerk receives an FX ticket in which the counterparty is not clearly identified. What should he/she do?

  1. Keep the ticket in “stand-by mode” until a matching confirmation is received
  2. Immediately refer the ticket to the compliance officer
  3. Refer the ticket to the FX dealer for further details
  4. Refer the ticket to the nostro account manager for further instructions

Question 44

Which risk factors fall under counterparty risk?

  1. Currency risk, interest rate risk and swap risk
  2. Settlement risk, delivery risk and replacement cost
  3. Operational risk
  4. Settlement risk and swap risk

Question 45

What are the three successive stages of money laundering?

  1. Integration, layering, placement
  2. Integration, placement, layering
  3. Placement, layering, integration
  4. Layering, integration, placement