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AFP CTP Exam
Certified Treasury Professional (Page 4 )

Updated On: 19-Jan-2026
Page 4 of 188
PDF with 1076 Questions

A company has $75 million in adjustable-rate debt, $25 million in fixed-rate debt, and $50 million in accounts receivable. If the company is concerned that interest rates will rise, which of the following would be the BEST interest rate derivative?

  1. An interest rate floor
  2. An interest rate collar
  3. A forward rate agreement
  4. An interest rate cap

Answer(s): D



According to the Capital Asset Pricing Model, which of the following would increase the required rate of return, given a beta of 1?

  1. A decrease in the tax rate
  2. An increase in the T-bill rate
  3. A decrease in the expected market return
  4. An increase in the company’s stock price

Answer(s): B



Capital budgeting decisions are most commonly evaluated in terms of:

  1. earnings allowance rate.
  2. internal rate of return.
  3. yield to maturity.
  4. financial leverage.

Answer(s): B



The PRIMARY difference between money market instruments and capital market instruments is that capital market instruments are securities that are:

  1. less than a one-year maturity.
  2. long-term in nature.
  3. generally more liquid.
  4. issued by lenders with credit ratings.

Answer(s): B



The mix of long-term debt and equity refers to a company’s:

  1. financial leverage.
  2. capital structure.
  3. current ratio.
  4. WACC.

Answer(s): B



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