FREE CTP Certification Questions And Answers

Question 1

An agreement that grants the right to purchase a certain quantity of common shares at a particular price is referred to as:

Accepted Answer

an equity warrant

Answer

An equity warrant gives a lender the option to buy a predetermined number of shares at a predetermined price per share (e.g., exercise price) or a specific percentage of the firm (usually between 1-5%). As a result, they resemble call options in the stock market.

Question 2

A corporation needs to issue loans at a low interest rate now but wants to issue further equity during the following 12 months. Which of the following tools would best achieve this goal?

Accepted Answer

Convertible bonds

Answer

An investor who purchases a convertible bond has the option or duty to convert the bond into a predetermined number of shares of the issuing business at specific points during the bond's tenure. It is a hybrid security that combines aspects of equity and debt.

Question 3

A loan agreement is one in which the borrower agrees to make regular payments to a different custodial account for the purpose of repaying the debt.

Accepted Answer

sinking fund

Answer

A sinking fund is a collection of funds that have been put up or saved to pay off bonds or debts. A corporation that issues debt will eventually have to pay that debt back, and the sinking fund lessens the burden of a significant outlay of revenue.

Question 4

Which of the following devices makes loan documentation for various advance features simpler?

Accepted Answer

Master note

Answer

A master note, sometimes known as a master global note, is a document that lists all the securities that were issued in accordance with a certain debt issuance plan.

Question 5

Which of the following international cash management strategies involves transferring ownership of the items when they are sold between companies?

Accepted Answer

Re-invoicing

Answer

Although the entity re-invoicing the given services did not perform them, the goal of re-invoicing is to shift the costs spent by the re-invoicing company onto the entity that actually used the given services.

Certified Treasury Professional Exam Practice Test

Certified Treasury Professional Exam Practice Test

FREE CTP Certification Questions And Answers