Free GARP FRM-Part-2 Exam Questions

Three and a half months ago, XYZ Manufacturing lost their single largest customer, and the company stopped service of all debt payments to ABC Bank. The bank has seized some collateral, but they are working with XYZ as they form plans to find new customers and build a better future. For now, the loans to XYZ Manufacturing should most likely be classified as:

A researcher at a national regulatory agency is examining the use of thestandardized ratings-based approach (SA) and the advanced internal ratingsbased(A-IRB) approach in determining credit risk capital. The researcherevaluates the implications of applying these approaches on two different banks,Global Bank and Resource Bank. Information about the credit exposures of the two banks is provided below:• Global Bank lends to large global corporations that have highly diversebusiness lines by providing sizable long-dated unsecured credit facilities.• Resource Bank lends to oil and gas producers in its region, most of which have small-scale operations.Which of the following is the most appropriate conclusion for the researcher to reach?

A portfolio has an equal amount invested in two positions, X and Y. The expected excess return of X is 9% and that of Y is 12%. Their marginal VaRs are 0.06 and 0.075, respectively. To move toward the optimal portfolio, the manager will probably:

Which of the following statements describes the best approach for liquidity transfer pricing?

Which of the following statements regarding risk management programs with service providers to manage outsourcing risk is correct?