1
Which of the following is NOT a retail banking product?
Your Answer
Operating Account
Correct Answer
Operating Account
Explanation
None.
2
What is the effective rate for a credit card if it has an annual nominal rate of 15%, compounded monthly?
Your Answer
16.08%
Correct Answer
16.08%
Explanation
Effective Rate = [1+ (0.15/12)]^12 - 1 = 0.1608
0.1608 x 100 = 16.08%
3
Which of the following about credit cards is FALSE?
Your Answer
Credit card interest rates are usually similar to the interest rates for a line of credit.
Correct Answer
Credit card interest rates are usually similar to the interest rates for a line of credit.
Explanation
None.
4
Which of the following types of loans would a person use to finance a major home renovation project?
Your Answer
Personal Loans
Correct Answer
Personal Loans
Explanation
None.
5
Which of the following services are offered at no cost to private banking clients?
Your Answer
Tax Planning
Correct Answer
Tax Planning
Explanation
None.
6
Which of the following is NOT one of the “sizes” of banking for businesses discussed in this course?
Your Answer
Multinational Banking
Correct Answer
Multinational Banking
Explanation
None.
7
Which products are used to help a business manage its working capital funding gap?
Your Answer
Electronic Funds Transfer, Overdraft, Revolving Line of Credit, Business Credit Card
Correct Answer
Electronic Funds Transfer, Overdraft, Revolving Line of Credit, Business Credit Card
Explanation
None.
8
Which of the following is NOT a commercial banking product?
Your Answer
Investment Management
Correct Answer
Investment Management
Explanation
None.
9
Which of the following is a product that can be used to reduce the counterparty risk in the trade cycle?
Your Answer
Import Letter of Credit
Correct Answer
Import Letter of Credit
Explanation
None.
10
What types of loans can be syndicated?
Your Answer
All of the above
Correct Answer
All of the above
Explanation
None.
11
Which of the following is NOT a reason why banks syndicate loans?
Your Answer
Syndicated loans allow banks to work together to set fees for all major lending transactions.
Correct Answer
Syndicated loans allow banks to work together to set fees for all major lending transactions.
Explanation
None.
12
Which of the following forms of financing ranks the lowest in seniority?
Your Answer
Equity
Correct Answer
Equity
Explanation
None.
13
What is considered the primary product/service of an investment bank?
Your Answer
Raising capital for corporations
Correct Answer
Raising capital for corporations
Explanation
None.
14
What is the difference in fees between the buy-side and sell-side for M&A transactions?
Your Answer
The buy-side faces more uncertainty with the success fee because it may not be paid if the deal falls apart.
Correct Answer
The buy-side faces more uncertainty with the success fee because it may not be paid if the deal falls apart.
Explanation
None.
15
Which of the following is NOT a sell-side investment banking product or service?
Your Answer
Asset Management
Correct Answer
Asset Management
Explanation
None.
16
What is the purpose of industry coverage groups in investment banks?
Your Answer
Industry coverage groups are needed to provide the right products and services to its clients with the proper industry expertise.
Correct Answer
Industry coverage groups are needed to provide the right products and services to its clients with the proper industry expertise.
Explanation
None.
17
For companies in distress, which of the following events would NOT likely trigger a restructuring?
Your Answer
Missed dividend payment
Correct Answer
Missed dividend payment
Explanation
None.