ICMA FMFQ Exam Practice Test Instant Access

Question 1

A company raises money in the capital markets by issuing a bond that is offered for sale by the issuing bank. Which of the following best describes this deal?

APrimary market deal

BSecondary market deal

COverdraft transaction

DDrawdown on a borrowing facility

Answer : A

Question 2

The dirty price of a bond is which of the following:

AThe same as the clean price

BClean price + interest of the period from the last coupon payment date

CClean price + interest of the period from settlement until the next coupon payment date

DClean price + trading commissions

Answer : B

Question 3

Which of the following best describes LIBOR?

AThe average rate at which wholesale bank deposits have taken place over the past 24 hours (since the last LIBOR fix)

BThe average rate at which wholesale banks are offering one another money at fixing time

CThe highest rate at which wholesale banks are offering one another money at fixing time

DThe average rate at which wholesale banks have offered money to their customers over the past 24 hours (since the last LIBOR fix)

Answer : B

Question 4

CHIPS is the payment system for which currency?

AGBP

BUSD

CEURO

DCHF

Answer : B

Question 5

What does the P/E ratio measure?

APrice/Earnings

BProfit/Earnings

CPrice/Estimated yield

DProfit/Estimated yield

Answer : A

Question 6

Which money market instrument is supported in the secondary market by primary dealers?

ADeposits

BCommercial paper

CT-bill

DCorporate bond

Answer : C

Question 7

What type of bond is a "Yankee" bond?

AGovernment bond

BEurobond

CDomestic foreign bond

DGlobal bond

Answer : C

ICMA Financial Markets Foundation Qualification FMFQ Exam Practice Test