< All Topics

IIBM – Risk Management and Financial Institutions Answer sheet

IIBM – Risk Management and Financial Institutions Answer sheet


Multiple Choices:

  1. The options that come into existence or disappear when the price of the underlying asset reaches a certain barrier.
  2. Asian Options
  3. Barrier options
  4. Basket Options
  5. Binary Options
  1. The volatility of this model is changing with time:
  2. EMWA Model
  3. GAMMA Model
  4. VEGA Model
  5. GARCH Model
  1. The office which consists of risk managers who are monitoring the risks being taken is called
  2. Front Office
  3. Middle Office
  4. Back Office
  5. None of the above
  1. A separate issue from the number of exceptions is:
  2. Bunching
  3. Grouping
  4. Stress testing
  5. None
  1. This simulation is a very popular approach for estimating VaR:
  2. Historical Simulation
  3. Accuracy
  4. Extensions
  5. None of the above
  1. Out of the following which rate is defined as the square of the volatility?
  2. Standard Deviation
  3. Variance
  4. Mean
  5. Median
  1. Risk measures satisfying all four conditions are referred to as:
  2. Time Horizon
  3. Auto Correlation
  4. Confidence level
  5. Coherent
  1. Only bonds with ratings of Baa or above are considered to be:
  2. Investment grade
  3. Internal Credit Ratings
  4. Altman’s Z- Score
  5. None of the above
  1. The by-product of any program to measure & understand operational risk is likely to be the development of:
  2. Risk & Control Self-assessment
  3. Key Risk Indicators
  4. Operational risk Capital
  5. Casual Relationship
  1. The Securities that are subject to a discount are known as:
  2. Collateralization
  3. Downgrade Trigger
  4. Haircut
  5. None of the above

Part Two:

  1. Explain ‘Collateralization’.
  2. Briefly explain the ‘Linear Model’.
  3. Explain the ‘GARCH-MODEL’.
  4. Explain the Concept of ‘Exchange-Traded Markets’.
  5. Differentiate between the Systematic vs. Nonsystematic Risk.
  1. In the 1980s, Bankers Trust developed index currency option notes (ICONs). These are bonds in which the amount received by the holder at maturity varies with a foreign exchange rate. One example was its trade at maturity varies with a foreign exchange rate. One example was its trade with the Long Term Credit Bank of Japan. The ICON specified that if the yen/US dollar exchange rate, ST , is greater than 169 yen per dollar at maturity (in 1995), the holder of the bond receives $1,000. If it is less than 169 yen per dollar, the amount received by the holder of the bond is 1,000- max [0, 1,000 (169 – 1) ST When the exchange rate is below 84.5, nothing is received by the holder at maturity. Show that this ICON is a combination of a regular bond and two options.
  1. Suppose that the risk-free zero curve is flat at 7% per annum with continuous compounding and that defaults can occur halfway through each year in a new 5-year credit default swap. Suppose that the recovery rate is 30% and the default probabilities each year conditional on no earlier default are 3%. Estimate the credit default swap spread. Assume payments are made annually.
  1. Suppose that 6- 6-month, 12-month, 18-month, 24-month, and 30-month zero rates are 4%, 4.2%, 4.4%, 4.6%, and 4.8% per annum, respectively, with continuous compounding. Estimate the cash price of a bond with a face value of 100 that will mature in 30 months and pays a coupon of 4% per annum semiannually.
  1. Suppose that the economic capital estimates for two business units are as follows: Business Unit 1 2 Market risk 10 50 Credit risk 30 30 Operational risk 50 10 The correlation between market risk and credit risk in the same business unit is 0.3. the correlation between credit risk in one business unit and credit risk in another is 0.7. the correlation between market risk in one business unit and market risk in the other is 0.2. All other correlations are zero. Calculate the total economic capital. How much should be allocated to each business unit?
  1. A Bank is considering expanding its asset management operations. The main risk is operational risk. It estimates that the expected operational risk loss from the new venture in one year is $2 million and the 99.97% worst-case loss (arising from a large investor lawsuit) is $40 million. The expected fees it will receive from investors for the funds under administration are $12 million per year and administrative costs are expected to be $5 million per year. Estimate the before-tax RAROC. Also, explain the two different ways in which RAROC can be used.
  1. Why is there an add-on amount in Basel I for derivatives transactions? “Basel I could be improved if the add-on amount for a derivatives transaction depended on the value of the transaction.” How would you argue this viewpoint?
  1. “A long forward contract subject to credit risk is a combination of a short position in a no-default put and a long position in a call subject to credit risk.” Explain this statement.

IIBM Institute

IIBM Answer sheets, academic support

 IIBM assignment help, student assistance

IIBM Institute solutions

IIBM MBA answer sheets

IIBM MBA case study answers

IIBM case study answers

IIBM emba answer sheets

IIBM emba case study papers

IIBM gms answer sheets

IIBM gms case study papers

IIBM advance diploma answer sheets

IIBM advance diploma case study answer sheets

IIBM DMS case study answers

IIBM DMS case study papers

IIBM Meerut

IIBM Patna

IIBM Guwahati


IIBM Bangalore

At Global Study Solutions, we take immense pride in our ability to offer specialized support to students pursuing various programs at IIBM Institute (IIBM Institute of Business Management). Our dedicated team comprises experienced professionals who excel in crafting precise and well-researched solutions for assignments and case studies across different disciplines and courses.

Our commitment to aiding students in achieving academic success aligns perfectly with the educational standards upheld by IIBM Institute (IIBM Institute of Business Management). We understand the importance of delivering high-quality, customized solutions that meet the unique requirements of assignments and case studies within the institute\’s curriculum.

Whether in MBA, EMBA, GMS, DMS, or any other programs offered at IIBM Institute (IIBM Institute of Business Management), our team is equipped to provide expert guidance and meticulously crafted solutions. We prioritize accuracy, originality, and timely delivery; ensuring students receive the necessary assistance to excel academically.

We are dedicated to fostering an environment of academic excellence and providing dependable support to the esteemed students of IIBM Institute.

IIBM Answer Sheets

Customized Answer Solutions

MBA Assignment Solutions

EMBA Case Study Solutions

GMS Answer Sheets

DMS Assignment Help

Professional Writing Assistance

Tailored Academic Solutions

Comprehensive Answer Sheets

Specialized IIBM Support

Academic Writing Services

Reliable IIBM Assistance

IIBM MBA case lets answer sheets

IIBM MBA answer sheets

IIBM MBA answer papers

IIBM EMBA answer sheets

IIBM EMBA case lets answer sheets

IIBM EMBA case studies

IIBM EMBA answer papers

IIBM Master Program in Lean Six Sigma Management answer sheets

IIBM Master Program in Total Quality Management answer sheets

IIBM Master Program in Accounting and Finance Management answer sheets

IIBM Master Program in Digital Marketing and Sales answer sheets

Get expert assistance with your IIBM Institute (IIBM Institute of Business Management). Assignments and answer sheets from our professional academic writing services.

Our team specializes in supporting students with IIBM Institute coursework, ensuring top-notch answer sheets and comprehensive solutions.

Ace, with our tailored assistance, your IIBM Institute exams, offering precise guidance and accurate answer sheet preparation.

Seeking reliable help for your IIBM Institute studies? Trust our academic writing services for meticulously crafted answer sheets and exceptional support.

Score high in your IIBM Institute (IIBM Institute of Business Management).  Assessments by availing our expert aid in preparing comprehensive and well-structured answer sheets.

Project Report Writing Services

Customized Project Reports

IIBM Institute Project Support

Professional Project Report Assistance

Tailored Solutions for Project Reports

Quality Project Documentation

Expert Project Report Writers

Comprehensive Project Analysis

Structured Project Report Services

Detailed Project Documentation

IIBM Project Evaluation Support

Custom Project Report Formats

Project Research and Analysis

MBA/EMBA/GMS/DMS Project Reports

IIBM Institute (IIBM Institute of Business Management).  Assignments, solved papers, and study materials are available through our academic writing services.

Seeking assistance with IIBM Institute coursework? Our professional team delivers accurate and timely solutions for all your academic needs.

Our specialized academic writing support simplifies access to IIBM Institute question papers and model answers.

Need expert guidance for your IIBM Institute assessments? Our service offers comprehensive solutions for students seeking assistance.

Our academic writing services ensure precise and high-quality answers for IIBM Institute assignments, aiding students in their educational journey.

Academic writing professionals play a crucial role in assisting students with their university assignments, striving to achieve several key goals:

Quality Assurance: Their primary aim is to deliver high-quality content that meets academic standards and fulfills the requirements of the university assignments. This involves thorough research, proper structuring, and adherence to guidelines provided by the educational institution.

Originality and Plagiarism-Free Content: Professionals in this field emphasize originality by creating authentic content free from plagiarism. To maintain academic integrity, they ensure that all information is appropriately cited and referenced.

Meeting Deadlines: Timely submission is a significant goal for academic writing professionals. They work within specified deadlines to provide students with completed assignments, enabling them to submit their work punctually.

Clear and Coherent Communication: Professionals strive to convey complex ideas in a clear, coherent, and academically appropriate manner. They focus on effective communication to ensure the content is easily understandable to the target audience.

Supporting Learning and Comprehension: Beyond completing assignments, academic writing professionals aim to support students\’ learning by providing explanations, analysis, and additional resources that help students grasp the subject matter more comprehensively.

Customization and Client Satisfaction: They tailor their services to individual student needs, providing personalized assistance and ensuring client satisfaction by addressing specific requirements and preferences.

Continuous Improvement: Academic writing professionals continuously update their knowledge base, research techniques, and writing skills to adapt to evolving academic standards and deliver the best possible support to students.