GARP Financial Risk and Regulation (FRR) Series 2016-FRR Dumps in PDF

Free GARP 2016-FRR Real Questions (page: 57)

A risk manager has a long forward position of USD 1 million but the option portfolio decreases JPY 0.50 for every JPY 1 increase in his forward position. At first approximation, what is the overall result of the options positions?

  1. The options positions hedge the forward position by 25%.
  2. The option positions hedge the forward position by 50%.
  3. The option positions hedge the forward position by 75%.
  4. The option positions hedge the forward position by 100%.

Answer(s): B



Which one of the following four options does NOT represent a benefit of compensating balances to the bank?

  1. Compensating balances allow the bank to net some of the exposure they may have in case of default, by taking funds from these specific deposit account one the borrower defaults.
  2. Since the compensating balances cannot be withdrawn at short notice, if at all, they are not considered transaction accounts and are able to provide a stable funding to the bank, reducing its reliance on more volatile external inter-bank based funding sources.
  3. Compensation balances influence the expected loss rate of the bank given the default obligor and improve capital structure by controlling obligor type and avoiding payment delays.
  4. Since the compensating balances reduce the next amount lent to the borrower, the earned return on the loan is increased, further widening the bank's interest rate margin and profitability.

Answer(s): C



In the United States, foreign exchange derivative transactions typically occur between

  1. A few large internationally active banks, where the risks become concentrated.
  2. All banks with international branches, where the risks become widely distributed based on trading exposures.
  3. Regional banks with international operations, where the risks depend on the specific derivative transactions.
  4. Thrifts and large commercial banks, where the risks become isolated.

Answer(s): A



Which of the following risk types are historically associated with credit derivatives?
I) Documentation risk
II) Definition of credit events
III) Occurrence of credit events
IV) Enterprise risk

  1. I, IV
  2. I, II
  3. I, II, III
  4. II, III, IV

Answer(s): C



Alpha Bank determined that Delta Industrial Machinery Corporation has 2% change of default on a one-year no-payment of USD $1 million, including interest and principal repayment. The bank charges 3% interest rate spread to firms in the machinery industry, and the risk-free interest rate is 6%. Alpha Bank receives both interest and principal payments once at the end the year. Delta can only default at the end of the year. If Delta defaults, the bank expects to lose 50% of its promised payment.

What may happen to the Delta's initial credit parameter and the value of its loan if the machinery industry experiences adverse structural changes?

  1. Probability of default and loss at default may decrease simultaneously, while duration rises causing the loan value to decrease.
  2. Probability of default and loss at default may decrease simultaneously, while duration falls causing the loan value to decrease.
  3. Probability of default and loss at default may increase simultaneously, while duration rises causing the loan value to decrease.
  4. Probability of default and loss at default may increase simultaneously, while duration falls causing the loan value to decrease.

Answer(s): D



Share your comments for GARP 2016-FRR exam with other users:

O
onibokun10
4/13/2026 7:50:14 PM

Question 129:
Correct answer: CNAME

  • A CNAME record creates an alias for a domain, so newapplication.comptia.org will resolve to whatever IP address www.comptia.org resolves to. This ensures both names point to the same resource without duplicating the IP.
  • Why not the others:
- SOA defines authoritative information for a zone. - MX specifies mail exchange servers. - NS designates name servers for a zone.
  • Notes: The alias name (newapplication.comptia.org) should not have other records if you use a CNAME for it, and CNAMEs aren’t used for the zone apex (root) domain. This scenario uses a subdomain, so a CNAME is appropriate.

A
Anonymous User
4/13/2026 6:29:58 PM

Question 1:

  • Correct answer: C

  • Why this is best:
- Uses OS Login with IAM, so SSH access is granted via Google accounts rather than distributing per-user SSH keys. - Granting the compute.osAdminLogin role to a Google group gives admin access to all team members in a centralized, auditable way. - Access is auditable: Cloud Audit Logs show who accessed which VM, satisfying the security requirement to determine who accessed a given instance.
  • How it works:
- Enable OS Login on the project/instances (enable-oslogin metadata). - Add the team’s

A
Anonymous User
4/13/2026 1:00:51 PM

Question 2:

  • Answer: D. Azure Advisor

  • Why: To view security-related recommendations for resources in the Compute and Apps area (including App Service Web Apps and Functions), you use Azure Advisor. Advisor surfaces personalized best-practice recommendations across resources, including security, and shows which resources are affected and the severity.

  • Why not the others:
- Azure Log Analytics is for ad-hoc querying of telemetry, not for viewing security recommendations. - Azure Event Hubs is for streaming telemetry data, not for security recommendations.
  • Quick tip: In the portal, navigate to Azure Advisor and check the Security recommendations for App Services to see actionable items and affe

D
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4/11/2026 5:36:42 AM

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4/8/2026 6:37:56 AM

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4/6/2026 5:22:54 PM

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L
LRK
3/22/2026 2:38:08 PM

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R
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V
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3/6/2026 5:26:16 AM

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J
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1/20/2026 8:25:24 AM

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N
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11/29/2025 2:19:59 AM

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9/25/2025 9:11:14 AM

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9/21/2025 7:07:26 AM

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9/15/2025 11:21:52 PM

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9/2/2025 7:42:00 PM

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7/31/2025 11:44:40 PM

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OLERATO
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