ICMA Exam FMFQ Topic 2 Question 48 Discussion

Actual exam question for ICMA's FMFQ exam

Question #: 48
Topic #: 2

[All FMFQ Questions]

Which of the following best describes LIBOR?

AThe average rate at which wholesale bank deposits have taken place over the past 24 hours (since the last LIBOR fix)

BThe average rate at which wholesale banks are offering one another money at fixing time

CThe highest rate at which wholesale banks are offering one another money at fixing time

DThe average rate at which wholesale banks have offered money to their customers over the past 24 hours (since the last LIBOR fix)

Show Suggested Answer

Suggested Answer: C

by Janine at Dec 23, 2023, 09:18 PM

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Sherita

1 months ago

Option B is the way to go. LIBOR is like the secret handshake of the banking world - you gotta know the insider lingo!

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Mauricio

18 days ago

I always thought LIBOR was a bit confusing, but now I understand it better with option B.

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Kasandra

21 days ago

I think option A might be more accurate, but I see where you're coming from with option B.

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Luis

22 days ago

Yeah, LIBOR is definitely important to understand in the banking world.

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Jacquelyne

27 days ago

I agree, option B is correct. It's all about the rates at which banks are offering each other money.

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Novella

2 months ago

I'm not sure, but I think it might be A) The average rate at which wholesale bank deposits have taken place over the past 24 hours. Can someone explain why it's not this option?

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Leontine

2 months ago

Hmm, Option D sounds tempting, but that's probably just the retail rates. LIBOR is definitely about the wholesale, interbank market. Option B is the way to go.

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Mee

8 days ago

User 2: I agree, LIBOR is definitely about the wholesale, interbank market. Option B is the correct choice.

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Mike

9 days ago

User 1: I think Option D is more about retail rates.

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Kristine

11 days ago

User 2: I agree, LIBOR is all about the wholesale, interbank market. Option B is the correct choice.

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Natalya

22 days ago

User 1: I think Option D is more about retail rates.

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Nu

2 months ago

I agree with Glendora. LIBOR is the rate at which banks lend to each other, so it makes sense that it would be the average rate at fixing time.

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Glendora

2 months ago

I think the answer is B) The average rate at which wholesale banks are offering one another money at fixing time.

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Alysa

2 months ago

I'm going with Option B. LIBOR is all about the wholesale lending rates between banks, not what they offer to their customers directly.

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Stephaine

13 days ago

Option B seems to be the most accurate description of LIBOR.

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Tammara

15 days ago

I'm not sure, but I think it's about the average rates at which banks lend to each other.

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Mozell

1 months ago

I agree, LIBOR is based on the rates banks offer one another at fixing time.

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Chuck

1 months ago

I think Option B is correct. It's about the rates banks offer each other.

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Cordie

2 months ago

I'm not sure, but I think it might be A) The average rate at which wholesale bank deposits have taken place over the past 24 hours. Can someone explain why it's not this option?

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Alverta

2 months ago

I agree with Callie, because LIBOR is the London Interbank Offered Rate, so it makes sense that it represents the rate at which banks offer money to each other.

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Ramonita

2 months ago

I was thinking Option A, but now that I think about it, that's probably just the daily volume of interbank lending, not the actual rates. Option B makes more sense.

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Callie

2 months ago

I think the answer is B) The average rate at which wholesale banks are offering one another money at fixing time.

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Krystal

2 months ago

Option B sounds like the correct description of LIBOR. It's the average rate at which banks lend to each other, which is a key benchmark for many financial instruments.

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