Question 1

The discount or premium on forward foreign exchange points is calculated based on:

Options :

A : the level of interest rates in the base currency

B : the level of interest rates in the counter currency

C : the differential between the interest rates in the two currencies

D : the current volatility in the FX markets

Answer: C

Question 2

When do you use a SWIFT message type 202?

Options :

A : For a foreign exchange confirmation

B : For multiple general financial institution transfers

C : For a general financial institution transfer

D : For a customer transfer

Answer: C

Question 3

Which one of the following best describes the correct order of the settlements process?

Options :

A : netting, trade entry, settlement, confirmation, nostro reconciliation

B : confirmation, netting, trade entry, settlement, nostro reconciliation

C : trade entry, confirmation, netting, settlement, nostro reconciliation

D : trade entry, confirmation, settlement, nostro reconciliation, netting

Answer: C

Question 4

You bought a 6x9 EUR 8,000,000.00 FRA at 4.50%. Settlement is now due and 3 months (90 days) EURIBOR is 3.50%. What amount do you pay or receive?

Options :

A : pay EUR 20,000.00

B : receive EUR 20,000.00

C : pay EUR 19,826.52

D : receive EUR 19,826.52

Answer: C

Question 5

Which SWIFT message formats would you use for a foreign exchange confirmation and fixed money market confirmation, respectively?

Options :

A : MT 400, MT 950

B : MT 200, MT 100

C : MT 300, MT 950

D : MT 300, MT 320

Answer: D

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