Preview Questions Treasury Manager | Role Specific Skill

Question 1: Which of the following describes a yield curve inversion and its significance to investment strategies?

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It is a sign of market instability with no economic implications

It signals inflationary pressures and declining bond prices

It suggests that short-term rates are higher than long-term rates

It indicates economic growth and a rise in interest rates

Question 2: How should Treasury Managers report the impact of hedging activities in financial statements?

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Gains and losses should be reported in equity

Gains and losses should be recognized immediately in the income statement

Gains and losses should be deferred and reported in comprehensive income

Gains should be excluded from financial statements

Question 3: Which of the following is a key consideration for a Treasury Manager when selecting assets for a portfolio in a low-interest-rate environment?

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The tax efficiency of investment vehicles

The portfolio's duration and sensitivity to interest rates

The high yield of fixed-income securities

The potential for capital appreciation

Question 4: What is the role of the net stable funding ratio (NSFR) in managing long-term liquidity risk according to Basel III?

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NSFR measures the ability to handle liquidity shocks in the short term

NSFR ensures that long-term assets are funded by stable sources of capital

NSFR is not applicable to banks with sufficient LCR levels

NSFR ensures that short-term liquidity needs are met

Question 5: What is the key financial indicator that a Treasury Manager uses to assess liquidity for financial planning?

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Debt-to-equity ratio

Quick ratio

Earnings Before Interest and Taxes (EBIT)

Return on investment (ROI)

Question 6: What is the significance of sensitivity analysis in planning?

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Determines regulatory impacts

Analyzes variance in key assumptions

Identifies cost-saving opportunities

Improves forecasting methods