A. overexposure to the real estate market

B. large losses at the proprietary trading desk

C. reliance on thinly traded derivatives to hedge

D. failure to guard its clients' best interests

A. Provide grants of US$800 million to help home buyers with down-payment and closing costs

B. Allow risky, high-cost loans to be credited towards affordable housing goals

C. Recapitalise Fannie Mae and Freddie Mac with US$2.4 billion of additional capital to ensure they weathered the risks associated with any future downturn in the housing markets

D. Provide tax credits of nearly US$2.4 billion over the next 5 years to investors and builders who developed affordable single-family housing in poor and distressed areas

A. Neither A nor B

B. Both A and B

C. The Board received risk management information that was incorrect, incomplete or insufficiently detailed

D. A window of time between close of day for reporting purposes and back office checking that allowed traders to hide losses using fictitious trades

A. A two-thirds affirmative vote of all members

B. The Blue Ribbon Advisory Panel

C. The Regional Directors

D. All PRMIA Fellow Members

A. Time value was not taken into account during the contract valuation process

B. Loss generating positions were rolled over by selling options on larger positions to generate cash premiums' to settle existing position losses

C. No properly defined risk management policies in place and general lack of oversight by senior management

D. Senior management in China were aware of the positions but did not understand the complexities of risk managing them

A. Respect local customs

B. Respect local laws and regulations

C. Ensure globally accepted standards are adhered to at all costs

D. Take responsibility for your work

A. None of the above

B. absolutely unaware of their uninsured liabilities

C. fully aware of the uninsured risks Fortress Re were taking

D. aware that they had some uninsured liabilities but thought they had enough capital to withstand any uninsured losses

A. Stress Testing was elaborate, complex and conducted on their entire portfolio. It included the assumptions of a major breakdown in historical correlations

B. Stress Testing looked at the 12 biggest deals with each of their top 20 counterparties

C. Stress Testing was not necessary because their trades were hedged

D. Stress Testing was not conducted