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PRMIA Exam IV: Case Studies: Standards: Governance, Best Practices and Ethics - 2015 Edition Sample Questions:
1. MGRM's losses due to "stacking" started to increase when
A) the oil market went from contango to backwardation
B) the oil market went from strong contango to weak contango
C) the oil market went from backwardation to contango
D) the oil market went from weak backwardation to strong backwardation
2. The problems at Bankers Trust can best be characterized as failures related to:
A) Operational and Regulatory Compliance Risk
B) Credit Risk
C) All of the Above
D) Market Risk
3. Boards, including Audit and Risk Committees must:
I. Clearly articulate the corporate risk appetite to senior management
II. Thoroughly review compensation plans of potentially "highly compensated positions" for consistency with corporate risk appetite, competitive market conditions and fiduciary responsibility to shareholders III. Have a single member formally given responsibility for understanding and reporting the effectiveness of the corporation's risk management infrastructure IV. Be fully accountable to shareholders and work to the benefit of public good and financial stability
A) I, II and III only
B) All of these are responsibilities of Board and Audit Committees
C) I and II only
D) I, II and IV only
4. The Q4 2003 trading strategy of China Aviation Oil was
A) to sell calls and buy puts
B) to buy puts and sell calls
C) to sell puts and buy calls
D) to buy calls and sell puts
5. John Smith wants to run for election to the Board of Directors of PRMIA. To be nominated, he needs:
A) The backing of five other members and to be serving on at least one PRMIA Committee
B) The backing of three other members
C) To go through a screening process conducted by the Nominations Committee
D) The backing of 6% of local members
Solutions:
Question # 1 Answer: C | Question # 2 Answer: A | Question # 3 Answer: B | Question # 4 Answer: A | Question # 5 Answer: B |
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