[Sep-2023] PRMIA 8004 Exam Basic Questions With Answers [Q61-Q85]

QUESTION 61
PwC concluded that the accounting policy adopted by China Aviation Oil was incorrect because it

QUESTION 62
A risk manager is asked to analyze the credit risk of a convertible bond. The risk manager has never analyzed convertible bonds, but does have significant expertise in credit risk. The risk manager accepts the assignment, finds a paper on the subject through the PRMIA web site and copies the method used there. The risk manager completes the assignment and delivers a report to his or her direct supervisor and the supervisor is quite pleased.
According to the PRMIA Standards of Best Practice, Conduct and Ethics (Code of Conduct), this was acceptable behavior if the following conditions were met:
I.The risk manager disclosed the lack of knowledge about convertible bonds
II.The methodology employed is disclosed and explained
III.The report was just to be used for analysis and not in practice
IV.The risk manager was sure of his/her understanding of the paper found on the web

QUESTION 63
While doing a work assignment, a PRMIA member notices behaviour that is outside the ethical standards of their client organization and reports the matter to their immediate supervisor in the organization (if he or she wasn’t the one engaging in such behaviour). The matter is neither progressed nor actioned.
The PRMIA member should:

QUESTION 64
The Fortress Re finite reinsurance model

QUESTION 65
According to the Group of 30 Report, option contracts:

QUESTION 66
When Fannie Mae and Freddie Mac were taken under US government conservatorship, which of the following was not included within their operating mandate?

QUESTION 67
PRMIA is incorporated as:

QUESTION 68
The multi-dimensional risk problem at Northern Rock did not include which one of the combinations of the following?

QUESTION 69
What was the main risk scenario on the Metallgesellschaft trading strategy?

QUESTION 70
The early 2003 trading strategy of China Aviation oil was

QUESTION 71
Which of the following is NOT part of the PRMIA Standards of Best Practice, Conduct and Ethics (Code of Conduct) Guidance on Ethical Behavior?

QUESTION 72
Unlike the case at Barings Bank, National Australia Bank:

QUESTION 73
John Smith wants to run for election to the Board of Directors of PRMIA. To be nominated, he needs:

QUESTION 74
As a PRMIA member, you have certain responsibilities. Among these are the requirement(s) to:

QUESTION 75
Which of the following CANNOT be counted as a reason why LTCM was given a rescue package and not left to default?

QUESTION 76
When describing the reasons for the collapse of China Aviation Oil, which of the following was not cited?

QUESTION 77
According to LTCM managers:

QUESTION 78
According to the PwC report China Aviation Oil, in order to avoid recording and reporting losses, the company adopted which approach covering up its losses?

QUESTION 79
Which of the following is part of the Group of 30 Report’s market risk and stress testing recommendations?

QUESTION 80
As a result of the US government’s intervention, which of the following is true?

QUESTION 81
According to the Group of 30 Report, dealers and end-users are encouraged to:

QUESTION 82
According to LTCM managers:

QUESTION 83
Taisei Fire and Marine Insurance Co

QUESTION 84
The hedging strategy employed by MG Refining & Marketing has been called:

QUESTION 85
What is (are) the lesson(s) of the Barings’ failure?