AIWMI CCRA-L2 CCRA - Level 2 Exam Practice Test Instant Access

Question 1

Step up upon feature will lead to

Ano change as step is not linked to issuers rating

Bpositive basis because the bond holder is compensated

Cnegative basis given that the bondholder is not compensated

DWill lead to a change only if there is a linkage to the issuer's rating

Answer : B

Question 2

The most important metric for a bank is the Net Interest Income (NII) which is the difference

between____income and____expense.

AInterest; Total

BInterest; Fee

CInterest; Interest

DTotal; Total

Answer : C

Question 3

A holder of which of the following types of bonds is least likely to suffer from rising interest rates?

AFloating rate bonds

BFixed rate bond

CZero-coupon bonds

Answer : A

Question 4

Which of the following may lead to the deterioration in credit profile of a bank?

Statement 1. Bank's Capital adequacy falling below regulatory requirement. Statement 2. Rise in Slippage ratio

ANone of the statement is correct

BBoth statement 1 and 2 are correct

CStatement 1 is correct

DStatement 2 is correct

Answer : A

Question 5

Project 1: Company X has a sugar mill at Philadelphia and is replicating same at Toronto.

Project 2: Company Y has a sugar mill at Philadelphia and is increasing capacity from 100000 MT to 140000 MT per annum.

What type of projects are Project 1 and Project 2?

AProject 1: Diversification; Project 2: Forward Integration

BProject 1: Expansion; Project 2: Forward Integration

CProject 1: Diversification; Project 2: Expansion

DProject 1: Expansion; Project 2: Expansion

Answer : C

Question 6

Which of the following is a factor considered while evaluating resources profile for rating of bank?

ASize and growth of deposits

BAll of the three

CDeposit composition & stickiness

DGeographic distribution of deposits

Answer : B

Question 7

Risk in CDS price is reflective of

Aincrease in probability of default

Bincrease in interest rates

Cdecrease in probability of default

Dincrease in recovery rates

Answer : A

AIWMI CCRA-L2 Certified Credit Research Analyst - Level 2 CCRA - Level 2 Exam Practice Test