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Question 322

A financial institution engaged in mortgage lending has embarked on a business process improvement initiative to eliminate the activities that hinder growth to ultimately improve the success rate of its mortgage business. As a benchmark for identification, the institution is keen on improving any business process that has less than a 75% success rate. The institution has appointed a business analyst (BA) to review the business transactions for the processes of origination, payments, and closures, as well as identify opportunities for improvements and recommend solutions.

The BA has collected the following information over the last three months pertaining to these business processes:

"¢ All the business processes are at their maximum capacity in terms of the current number of transactions.

"¢ Each business process has a certain number of rejects and the reasons for rejection include documentation, verification, collateral, and funding. Funding rejects occur when the bank's customers have failed to make payment of their mortgage processing fee or mortgage closure payment.

The BA has also recommended the use of documentation checklists as a solution to eliminate the documentation rejects.

Assuming the BA's recommendation to be true, what will be the new success rate of the mortgage closure process?

    Correct Answer: A

    To calculate the new success rate of the mortgage closure process, assuming that the BA's recommendation effectively eliminates documental rejects, we can start by adding the current documental rejects (3) to the total successes (24). This results in 27 successes out of 30 transactions. The success rate would then be (27/30) * 100 = 90%. Therefore, the correct answer is 90%.

Discussion
ChykaOption: A

90% being 27/30

MAB14Option: A

Assuming the BA's recommendation to be true 24 + 3 out of 30 27/30 = .9 =90%

TheBusBusOption: A

Documental rejects will be zero, making total successes 27 of 30; in percentage, this is 90%.

AdeCBAPcertifiedOption: A

27/30=0.9*100=90%

WolfedaleOption: A

(24+3) / 30 = 0.9

SavvyBAOption: A

90% seems like the correct answer.

raf79Option: A

Add Documents on reject (3) to Total Successful (24) = 27. Then divide by Total number (30) x 100 = 27/30 * 100 = 90%

raf79Option: A

Add Documents on reject (3) to Total Successful (24) = 27. Then divide by Total number (30) x 100 = 27/30 * 100 = 90%

UppersquareCapitalOption: A

90% should be the correct answer

Crown_GiftOption: B

The answer is 85%. 30*1.5 = 45. 45-6 = 39. 39/45 = 86.666

Yoli22_

Don’t understand the 45 - 6. Ideally it would be 45 - 3 as document rejection is eliminated which would be 0. If we should say funding rejects increase by 50% it would be 45 - (3+1.8) i.e assuming % of funding rejects increases 10% of 45 = 1.8 #3+1.8 = 4.8) 45 - 4.8 = 40.2 = 89.3%. However, I believe the key is that we are not advised in this particular scenerio that capacity is increased by 50%. If it was important I believe it would be mentioned here.

drimzOption: A

the answer is A= 90%

mabelweealOption: B

Is the answer B because document rejects may not be totally eliminated?

sojomoojo

One more flunked answer... This author is a joke.

OlivierPaudexOption: A

Why answer B (85%) ? It's almost impossible to have 85%. 90% should be correct