1. A borrower's source of repayments typically are from:

a. Employment-related income

b. Business assets

c. Savings accounts

d. Other borrowing arrangements

2. An auto loan would be typically classified as a:

a. Open-end revolving line of credit loan

b. Commercial (business) loan

c. Closed-end installment loan

d. Mortgage loan

3. The general components of a retail closed-end installment loan are:

a. a predetermined loan amount

b. periodic payments of principal and interest

c. a specified term

d. borrower does not have the option of obtaining additional funds

e. all of the above

4. A credit card would be typically classified as a:

a. Open-end revolving line of credit

b. Commercial (business) loan

c. Closed-end installment loan

d. Mortgage loan

5. Open-end revolving lines of credit include:

a. Periodic fixed payments of principal and interest

b. A specified term

c. Amounts available to a borrower up to preset credit limit

d. Loan payments that bring the balance down to $0 upon maturity of the loan

6. Differentiation of risk for lenders has increased with the emergence of:

a. governmental oversight

b. technology advances

c. internal loan origination

d. indirect lending

7. When taking out a loan, a high credit risk means what?

a. It's very likely that the borrower won't repay the lender.

b. It's very likely that the borrower will repay the lender.

c. The person has a lot of capital

d. The person has a lot of credit

8. A bank's outstanding loans have fixed interest rates, with maturities in excess of two years such that the bank's deposit liabilities (the loan funds) have maturities all less than 6 months. What type of risk is the bank facing?

a. Credit risk

b. Interest Rate risk

c. Operational risk

d. Compliance risk

9. When a bank fails to act in accordance with industry laws and regulations, internal policies or prescribed best practices it subjects itself to:

a. Compliance risk

b. Strategic risk

c. Liquidity risk

d. Reputation risk

10.The creation of millions of fraudulent savings and checking accounts on behalf of Wells Fargo clients without their consent is a prime example of:

a. Credit risk

b. Strategic risk

c. Reputation risk

d. Interest rate risk