47 Questions
What is the main difference between the predictive and adaptive approaches to the System Development Life Cycle (SDLC)?
The predictive approach assumes well-understood requirements and low technical risk, while the adaptive approach assumes uncertain requirements and high technical risk.
What is the main characteristic of the Waterfall model in the context of the SDLC?
It assumes that the project can be planned in advance and that the information system can be developed according to the plan.
What is the purpose of the Support phase in the SDLC?
To maintain and enhance the system after it is installed and in use.
What is one of the activities included in maintaining the system during the Support phase?
Adding or changing functionality to comply with regulations or legislation.
What is meant by 'Incremental Development' in the context of Adaptive SDLC?
Completing portions of the system in increments.
What is a characteristic of the Spiral Model in the context of Adaptive SDLC?
Being the first adaptive SDLC.
What is the main difference between Structured Approach and Object-Oriented (OO) development?
The Structured Approach is an earlier approach, while OO development is a newer approach.
What does 'Walking Skeleton' refer to in software development?
Building the complete system structure early, but with bare-bones functionality.
What is the main aim of Asset Management for a commercial bank?
Deciding the diversified portfolio of uses of fund to generate maximum return
What is the purpose of Liabiliy Management for a commercial bank?
Minimizing the cost of sources of fund
What is the role of Liquidity Management in a commercial bank?
To ensure the bank can pay off its liabilities in case of deposit outflow
How are Required Reserves (RR) calculated in a commercial bank?
RR = required reserve ratio (rD) * Deposits (D)
What does the Excess Reserves refer to in Liquidity Management?
Reserves that exceed the required reserve ratio
What is set legislatively by the Central bank to ensure Liquidity Management in commercial banks?
Required reserve ratio
What is the equation for excess reserves (ER) in terms of excess reserve ratio (rE) and deposits (D)?
ER = rE * D
What is the main objective of liquidity management in a bank?
Avoiding liquidity shortage
What is the consequence of a cash withdrawal on a bank's reserves and deposits?
Reduction in reserves and deposits
How is the required reserve ratio different from the excess reserve ratio?
Required reserve ratio is obligatory for all banks, while excess reserve ratio is optional
What happens if a bank's actual reserves are lower than the required reserves?
Liquidity shortage occurs
In dealing with liquidity shortage, which option is considered the best solution?
Selling securities at the current market price
What is the calculation for required reserves as a percentage of current deposits?
$\text{Required reserve} = \text{Percentage} * \text{Deposits}$
In a scenario where a bank has a $100 million deposit and a 10% reserve requirement, what would be the shortfall if $10 million is withdrawn?
$9 million reserve shortfall
What is the main concern of liquidity management in a bank?
Maintaining the balance between avoiding liquidity shortage and increasing bank's returns
What is the consequence of a cash withdrawal on a bank's reserves and deposits?
Decrease in both reserves and deposits
How is liquidity shortage in a bank defined?
When actual reserves are lower than the required reserves
What is the best solution for covering liquidity shortage in a bank, based on the provided options?
Selling securities at the current market price
How are required reserves calculated in a commercial bank?
As a percentage of the current deposits in the bank
What is the difference between required reserve ratio and excess reserve ratio?
Required reserve ratio is obligatory, while excess reserve ratio is optional and can differ between banks
What does dealing with liquidity shortage involve in a commercial bank?
Recalling loans and losing customers
What occurs if a bank's actual reserves are lower than the required reserves?
The bank faces liquidity shortage
In a scenario where a commercial bank has $100 million deposit and 10% reserve requirement, what would be the amount of reserve shortfall if $10 million is withdrawn?
$9 million
What is the main aim of asset management for a commercial bank?
To optimize the allocation of assets to achieve financial goals
What is the equation for excess reserves (ER) in terms of excess reserve ratio (rE) and deposits (D)?
ER = rE * D
How are required reserves calculated in a commercial bank?
As a percentage of the current deposits in the bank
What is the best solution for covering liquidity shortage in a bank, based on the provided options?
Selling securities
What does dealing with liquidity shortage involve in a commercial bank?
Covering the shortage through selling securities, borrowing, or recalling loans
What is meant by 'Incremental Development' in the context of Adaptive SDLC?
Developing software in small, manageable parts
What is the main aim of Asset Management for a commercial bank?
Balancing liquidity and returns
What occurs if a bank's actual reserves are lower than the required reserves?
The bank has a liquidity shortage
What is set legislatively by the Central Bank to ensure Liquidity Management in commercial banks?
Required reserve ratio
How is liquidity shortage in a bank defined?
When actual reserves are lower than required reserves
What is the main objective of Liquidity Management for a commercial bank?
Ensuring the bank can pay off its liabilities in case of cash outflow
What is the purpose of Asset Management for a commercial bank?
Deciding the diversified portfolio of uses of funds for maximum return
What is meant by 'Excess Reserves' in Liquidity Management?
The reserves kept above the required reserve ratio as a percentage of deposits
How are Required Reserves calculated in a commercial bank?
Required reserve ratio (rD) * Deposits (D)
In Liquidity Management, what does the Central bank legislatively obligate the banks to keep?
Required Reserve Ratio
What does Asset Management aim at deciding for a commercial bank?
The diversified portfolio of uses of fund for maximum return
Test your knowledge of the support phase of the SDLC, two approaches to software construction and modeling, as well as iterative and agile system development life cycle. This quiz is based on content from Chapter 8 of the book 'Systems Analysis and Design in a Changing World, 6th Edition'.
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