R3 Corda Application in Blockchain Finance BFC Practice Questions (Page 2)

Questions 6–10

1. 6expert · hard

   A Corda network for a central securities depository (CSD) must handle high throughput. The CSD also requires that all transactions be validated for business logic, but some participants are concerned about revealing transaction details to a central authority. The CSD is considering using a non-validating notary to improve performance. What is the main trade-off they must accept?

   • AThe notary will require all parties to send their full transaction data, reducing privacy
   • BThe notary will not validate the business logic of transactions, so the parties must ensure contract validation is performed by all involved nodes
   • CThe notary will become a single point of failure, requiring a highly available cluster
   • DThe notary will store a copy of all transactions, increasing storage requirements
   Reveal Solution Discussion Select an answer first
2. 7application · medium

   A consortium of banks wants to use Corda to automate a letter-of-credit process. Each bank runs its own node, and they need to ensure that only the parties involved in a specific trade see the transaction details. The solution must also prevent double-spending of the same letter-of-credit across different trades. Which two Corda components should the architect emphasize in the design?

   • APoint-to-point messaging between nodes, with each node maintaining its own vault and a notary providing uniqueness consensus
   • BA central database managed by the lead bank, with all other nodes querying it for transaction history
   • CA shared global ledger replicated to all nodes, with a notary cluster that validates every transaction
   • DA public blockchain with all transactions visible to all nodes, using proof-of-work consensus
   Reveal Solution Discussion Select an answer first
4. 8application · medium

   A bank is building a Corda application to automate a syndicated loan agreement with two other banks. Each bank runs its own Corda node. The loan terms are defined in a contract, and the loan state is shared only among the three banks. During a transaction, the three banks must all sign the transaction before it is finalized. Which Corda component is primarily responsible for orchestrating the signing and finalization steps across the three nodes?

   • AA flow that coordinates the collection of signatures and then calls FinalityFlow
   • BThe contract's verify() function that automatically signs the transaction on behalf of all participants
   • CA notary service that validates the transaction and then collects signatures from all parties
   • DThe network map service that broadcasts the transaction to all participants for manual approval
   Reveal Solution Discussion Select an answer first
5. 9application · medium

   A Corda network is set up with multiple notaries to improve scalability. A transaction involving two banks is sent to a notary in a specific notary cluster. What is the key requirement for the transaction to be finalized?

   • AThe transaction must be broadcast to all nodes for consensus
   • BAll notaries in the network must validate the transaction
   • CThe chosen notary must confirm that the input states have not been consumed before
   • DThe notary must re-run the contract's verify() function
   Reveal Solution Discussion Select an answer first
6. 10application · medium

   A developer is writing a Corda contract for a simple payment obligation. The contract must ensure that the sum of the output states equals the sum of the input states, preventing the creation or destruction of value. Which function in the contract should contain this logic?

   • AThe network map's registration process
   • BThe flow's call() method
   • CThe verify() function
   • DThe notary's validation logic
   Reveal Solution Discussion Select an answer first