Frequently asked Business Analyst Interview Question

For what reasons does a BA correspond with a Vendor? How can he deal with a vendor effectively? When does a BA use Test Director Tool and for what purpose in a project? What does a BA do when DEV Team recommends a better solution in the application? What real challenges does a BA face in different phases of the project? Which phase of the project does a BA stop using the Requirements Traceability Matrix and when does him start to use it for the first time. What is the role of BA in Design, Build, Test phases of a project? What are HIGH/MED/LOW Use Cases? What are the primary steps to create use cases? How does a BA figure out Use Cases from Requirements Specifications Document?

Business Analyst finance domain interview Questions

How are the three terms, pre-qualification, pre-approval & final loan approval differs from each other? The first process called pre-qualification involves the assessment of the total mortgage you can offer to the lender and this is determined by the income-proof provided by you and your credit report. The verification of your employment and accounts information is conducted in the next process called pre-approval. In this very process your mortgage capacity is approved after estimating the market value of the property you are interested in. The last process, known as the final loan approval, marks the completion of the loan approval with all necessary documents and other formalities including contingency plan been finalized by the lender.

How many types of first-time buyer programs are there? You can confirm about the different buyer programs available to you through your agent. But always remember that buyer programs are mostly there at the level of your local community, state or province, rather than at the level of the nation. This is because the buyer programs are frequently created and operated upon at the local level.

How could I know that which one is the best of the number of different mortgage plans? To choose the best mortgage plan for yourself youll have to do some research. This research should include from a local bank having a mortgage program to the brokers that have a wide

range of lenders to offer. Other than that you should also visit some sources online, like LendingTree, where you will get information about the lenders from across the U.S. You can also have three lenders on offer from a single loan request form that are vying to give you the loan. Is the IRA retirement fund is accepted as the down payment for a house? If its your first time to buy a house then you are most welcome to utilize your IRA retirement funds. Moreover, The IRS stipulates that husband & wife can separately utilize up to $10,000 as the qualified acquisition costs that is also penalty-free, provided each of them is buying the house for the first time. The qualified acquisition costs is nothing but the costs of having a house built, rebuilt or bought, including other financial transactions, like closing and settlement costs. First time homebuyer: A person having no claim on the main home at least for 2 years, after the end of which he or she owns the main home (his or her spouse) to which these conditions applies, is considered as the first-time buyer. Am I liable to pay points? When you compare the different mortgages, you must take into notice the number of points, that is your up-front interest, together with your rate of interest. Are there any options for the individuals having bad credit record? Yes, there are! Many lenders are particularly concerned with this kind of clients only. Many of the buyers missed the opportunity of having a better deal stroked because of their sheer apathy towards their credit report. It is not always that your credit report is as worse as you think it is. You can get a fair deal once you sit down and re-evaluate your credit report and correct the errors if any along with handling your account better. Here you are provided with a scheme of free credit report together with free Credit Check Monitoring Service for 30 consecutive days. If you are also facing the problem of a poor credit report, but want a great deal on your mortgage then you can rely on the service of the LendingTree.

What the terms front ratio & back ratio indicates to, as I frequently encounter them when looking for a mortgage program? Before you are awarded a loan it is determined that of what scale a house you can afford and it is assessed through your present income. This process involves these two terms, front & back ratio. Front Ratio: It is the ratio of all the mortgage payments (PITI) that includes your taxes, principal amount, insurance, and condominium to your GROSS income. It should be under 28% mark, but is not compulsory. For an instance, if your income is $37000/month and your total mortgage payment is $973, and then your front ratio will end up being 26%.

Back Ratio: It is the ratio of the sum of your total mortgage payment, credit card payments, car payments or any other kind of loan payments to your GROSS income. Its limit is up to 36%. For an instance, if your income is $37000month, your mortgage payment is $973, two credit card payment is $59 and & $43, car payment is $212 that adds up to $1287, and then your back ratio would be 35%. What should a buyer do in case he doesnt have any money for the down payment and for the closing costs? There are a few mortgage programs that allow the individuals having low or no money to buy a home. But still, you are supposed to deposit funds for the down payment or the closing cost or in some cases both. This is because the lenders expect you to be actively participating in the program, as a substantial amount of your income would go into the mortgage payment. In some circumstances it has been seen that the seller itself bears some of the closing costs (normally ranges between 3%-5%) or the cost of down payment is lowered (up to 5%). But it is very hard to find a case of no down payment at all. Although, having a good credit report and money for the closing costs, enables an individual to benefit in some ways in the area of conventional loan.

What are stocks and trading

Trading Of Stocks
Exchanges are the places where both the sellers and the buyers transact with each other. Exchanges can be of two types: physical and virtual. Physical exchanges have some trading floors for the transactions, while the virtual exchanges make use of computers and Internet for the trading. It is most likely that you have seen the actions of the traders going out in the physical exchanges on TV or through some other sources. Stock market is a place that provides all of the basic requirements that one needs to trade in a secure environment. It would have been almost impossible to trade or transact without compromising with your security and privacy, if this kind of exchanges were not there. So, the exchanges could be taken as a wholesale market that caters to the need of every buyers and sellers. Now proceeding further to understand the stock market one must know the importance of the two types of market: Primary & Secondary. Primary market is involved in the creation of securities through IPO and secondary market deals with the trading of those securities. This very secondary market is construed as the stock market, where the investors trade their securities without any direct engagement of the issuing company.

How many types of OPTIONS are there? There are mainly two types of OPTIONS called calls and puts. The former provides an authentication to an individual to make a purchase of some property within a given time frame and is very much similar to a stocks long position. Buyers invest in the calls with an expectation of a large raise in the value of stocks. But when it comes to put, the holder gets an authentication to sell some property or asset within a given time period and it is very much similar to a stocks short position. How many types of Bonds are there? Treasury bonds this bond is the most widely known and is issued by the U.S. government only with a starting value of $1000. Its maturity being longer than 10 years has a fixed interest rate and is marketable too. Municipal bonds this bond can be issued by municipality or the state or the country itself and its purpose is to provide debt security by financing the public expenditures. Corporate bonds this bond is issued by the corporations only and thus taxable. Normally it has a par value of $1000 and a maturity term, but can be traded freely at major exchanges. Zero coupon bonds it is named zero coupon bond because there no payment in terms of coupon is made rather an initial discount is offered at the par value. As an instance, a trading value of $600 could be possible for a zero coupon bond that has its par value at $1000 and maturity term of ten years. So, this zero coupon bonds would be worth of $1000 after the expiration of its maturity term.

How many types of swaps are there?

Forward swap It is also known as delayed start swap, forward start swap or deferred start swap and is a kind of swap agreement that is often valued with two different and partial offsetting swaps and both the swaps starts immediately. But one of them ends on the date of the start of the other one known as forward swap. This swap is specially designed for the timing convenience of the investors. Total return swap it is the most widely used form of swap in physical commodities market or in case of equity market. It is a kind of swap agreement that allows one party to pay according to a fixed rate or according to a variable rate. But, the other party only pays according to the returns it gets from the underlying assets like loans, bonds, etc. and includes the generated income from and the capital gains of the underlying assts. Currency swap it is the kind of swap with the help of which all of the principal amount as well as the interest on that amount of a particular currency can be swapped with another currency and it is free of any kind of exchange rules.

Circus swap it also termed as currency coupon swap or cross-currency swap and includes the characteristics of both the currency swap as well as of the interest rate swap. Under this swap a loan of fixed rate of a particular currency can be replaced with a loan of floating rate of some other currency. Commodity swap this is a kind of swap under which all of the cash transactions are the result of the underlying commodity and hence called commodity swap. Through this swap an institution gets a fixed price from the commodity user and market price from the commodity producer. The financial institution in return facilitates the required needs of both the parties. Asset swap Under this swap agreement, only the floating or the fixed investments are swapped but not the fixed or floating interest rates and this swap is almost similar to the plain vanilla swap except the underlying swap contract. Interest rate swap it is the kind of swap agreement between two companies or banks to switch over a floating rate loan into a fixed rate loan or vice versa in different countries. The currencies into which the swap has taken place could be either same or different. Constant maturity swap it is the kind of swapping agreement under which a buyer has the right to set its own time duration for the received flows on a particular swap. It can of two different types termed as cross-currency swap or single currency swap. This swap allows the readjustment of a part of the interest rate periodically based on the fixed maturity rate of the market and it is a variant form of interest rate swap. But it cannot be readjusted with any floating reference index rate. Basic rate swap Generally, due to different rates of borrowing and lending, companies run the risk of interest rate, which is neutralized with the help of basic rate swap. It enables the two parties involved in the agreement to exchange the interest rates varying according to money markets. Variance swap It is a variant of the volatility swap and under this swap the linearity of variance go along with the payout, not with the volatility as in the case of volatility swap. This difference makes the payout as the one with higher rates, not the volatility. Overnight index swap it simply involves the swapping of a fixed interest rate to an overnight rate. Zero basic rate also known as Zebra swap, actual rate swap or perfect swap and is a swap agreement between a financial intermediary and a municipality. Under this swap agreement, the financial intermediary receives from the municipality a floating rate of interest and pays to the municipality a fixed rate of interest. Roller coaster swap it is a kind of seasonal swap that gets created for meeting the periodical financial requirements of the counter-party and provides some liberty in terms of payment according to the periods set beforehand. So if a company is dealing in some commodity, which has its demand seasonally, then the company will surely go for a roller coaster swap.

Airbag swap this swap gets created to counter the effects of fluctuating interest rates that puts a negative pressure on the investment. This counter effect is achieved through the adjustment of the notional value of the fluctuating interest rate by indexing the very part of the interest rate that is fluctuating to a constant maturity swap.

What do you consider is your greatest strength as a Business Analyst? I think the biggest strength is the domain and the technical experience that I have had over the years as a business analyst. I have the right communication and leadership skills required to excel in this role.

What do you consider is your biggest weakness as a Business Analyst? I would like to think that my weaknesses are like my stepping stones towards success. At present I would like to fine tune my technical abilities to the constantly changing technologies available in the market. What are the methods you use for gathering requirements ? As a business analyst, we not only have to gather the requirements but also provide solutions often with the help of the technical team

Requirement gathering with Zachman framework - Use the famous 5W + 1H formula (Who What When Where Why + How). Keep asking about the problem with this formula to find the principle requirements

Implicit requirements we should not forget about these as they can make or break the whole project Prototyping and process flows these tools help in illustrating the requirements to the end users and confirm whether the Business analyst has done the requirement analysis correctly

What is the difference between Quality Assurance and Quality Control and how are they related to the Business Analyst profile ? Quality Assurance focuses on the process: is the method chosen able to produce the product or is the deliverable free from errors and/or defects. Quality Control speaks about the products or deliverables themselves: the final examination of the product or deliverable to ensure they stand to the specifications and theyre free from error of defect. A business analyst has to take care of Quality Assurance as well as control is in place in the final product which is delivered. What are the challenges which you would face as a business analyst? A balance between technology constraints and business needs should be maintained at all times. Technology is used to help fulfilling business need, so its usually close to the need. You also have to keep an open mind as to how a process works effectively and accurately produce the required product. Then, you must make sure that the written specifications are written properly to avoid misinterpretations. How did you handle a requirement/enhancement that was not feasible? I know that even if I think a requirement was not feasible, I have a responsibility to explain why it was not feasible to the business representatives. So first Id clarify the requirement, what was the true requirement there. Then, Id explain the technical limitations in non-technical language to them as to why the requirements couldnt be accommodated at the same time. Most of the times, the reason was not feasible because its not affordable. After I present the business representatives with the estimated cost, they would decide whether or not the requirement was really needed. Whichever the outcome was, the business representatives would feel that theyre in command and theyre involved in the decision making process.

What do you think are your strengths as a Business Analyst? I think that I have following strengths in my past profile as a business analyst: The right mix of functional and technical knowledge Ability to communicate effectively between the development (whether internal or third party vendors) team and the end users. 2. Strong levels of persistency and quick learning capability Adaptability to the work environment as desired. What do you think are your weaknesses as a Business Analyst? I believe in turning my weaknesses into strengths, so I strive towards having a calm and cool attitude. Also, I would like to at par with the latest technology in the market but its not always possible. 3. What can you do for us that other prospective candidates cannot? I am confident on being the best fit for this role as my principles are I believe to be in line with the company vision and mission. I will bring to the organization my technical knowhow as well as my functional expertise, striving to achieve success for the company What is the importance of a flow chart??? Flow chart is graphical representation of the process which makes the system simple to understand for all the persons who belongs to the development of the project. What is a use case model? Explain in brief ? Use case diagram: Use case diagrams describe the business environment. It is a series of events / flow of actions related to a process that are performed by an actor. What is called an UML modeling? UML means unified modeling language. It is the standard language for constructing, visualizing and documenting the components of a system. What is the importance of an Activity diagram? The main use of an activity diagram is to show the work flow of the business and to show the activities happening in the business system and actions completed. In a companies there may be different sections like medical, accounting, HR etc..and each department has different privileges

to the system. I.e medical dept can access only medical related screens and HR dept to only HR screens etc..So this activity diagrams shows the activities of different departments with their relation. This will be useful to the developers while designing and coding. How many types of diagrams and what you know about them ? Use case diagram & Collaboration diagram. What is meant by alternate flow in use case ? It is a flow that will come into picture when there is a failure in the system and expected results did not come. What do you mean by exception flow in a use case? It is basically any unexpected situations or unusual results in an application. These exceptions are handles in different ways. What do you mean by extends and includes in an use case? Extend means when there is a specific action must take place. And include means the action may or may not take place. What are different documents that relate to a use cases.? There are 2 docs. FRD (functional requirement document) SDD (system design document) / TRS (Technical requirements specifications)

What are the common tools that are used by a business Analyst? Ans: Rational tools, MS Visio, MS word, MS Excel, Power point, Quality center/test director MS Project, And there may be some tools which are project and client specific which you do not have to worry. etc.. What are the documents that a Business Analyst needs to deliver? Ans: Well there are some important documents such as "functional specification documents, technical specification documents, Requirements traceability, BRD (business requirements document), Use case diagrams, Business flow, etc.. Can you tell me what a use case diagram? Ans: First of all a use case diagram is a part of UML and it is a behavioral digram which is created from a use case analysis. The main reason or use of this use case diagram is it defines the functions of the module or system and the role of each actor associated to that function. For Eg: "Order Management" is a main function, and the person who receives the order in the office is an actor.