SOFE AFE Practice Questions| TestInsights

Question 1

Asset and liability management is:

AAn approach of matching assets and liabilities that requires a correct mix of long and short term investments.

BAn approach of mix assets and liabilities in a financial statement that requires specific long and short term revenues.

CAn approach of mix assets and liabilities in a financial statement that requires specific long and short term revenues.

DAn approach of specific assets and liabilities in a financial statement that requires correct mix of long and short term revenues.

Correct : A

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AAn approach of matching assets and liabilities that requires a correct mix of long and short term investments.

BAn approach of mix assets and liabilities in a financial statement that requires specific long and short term revenues.

CAn approach of mix assets and liabilities in a financial statement that requires specific long and short term revenues.

DAn approach of specific assets and liabilities in a financial statement that requires correct mix of long and short term revenues.

Question 2

Short-term portfolios are:

APortfolios consisting of liabilities with maturities of one year to meet dollar needs.

BPortfolios consisting of combined revenues of less than one year to meet liquidity needs.

CPortfolios consisting of assets with maturities of less than one year to meet liquidity needs.

DPortfolios consisting of expenses with maturities of less than or equal to one year to meet dollar needs.

Correct : C

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APortfolios consisting of liabilities with maturities of one year to meet dollar needs.

BPortfolios consisting of combined revenues of less than one year to meet liquidity needs.

CPortfolios consisting of assets with maturities of less than one year to meet liquidity needs.

DPortfolios consisting of expenses with maturities of less than or equal to one year to meet dollar needs.

Question 3

The maturity of which agreement is fixed by the contract and depends on the needs of the borrower and the willingness of the lender?

AFixed agreement

BStandard agreement

CShort-term agreement

DRepurchase agreement

Correct : D

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AFixed agreement

BStandard agreement

CShort-term agreement

DRepurchase agreement

Question 4

The difference between the purchase price and the repurchase price, or sale price, plus accrued interest on the security represents:

AAccounting agreement

BInvestment income

CDollar price

DSaving price

Correct : B

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AAccounting agreement

BInvestment income

CDollar price

DSaving price

Question 5

The evaluation and subsequent purchase or sale of investments is based on the judgment of the entity's investment and finance committees.

ATrue

BFalse

Correct : A

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ATrue

BFalse

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