[Jan 11, 2022] Free CFA Level CFA-Level-I Exam Question
CFA-Level-I dumps & CFA Level sure practice dumps
NEW QUESTION 451
Which of the following characteristics is not representative of an industry that's in the maturity stage of its life cycle?
- A. Instead of product differentiation, price is the primary competitive weapon.
- B. There are a lot of companies from other industries entering into this particular industry.
- C. Competition is intense among the rivals within the industry.
Answer: B
Explanation:
As an industry matures, sales are either stagnant or growing slowly. This lack of industry sales growth forces companies to increase sales by stealing market share from each other, often using price to lure away customers. All these factors make the industry a very unattractive market for new competitors to enter into.
NEW QUESTION 452
The main difference between the t and z statistic is that the t statistic
- A. is less variable than the z statistic.
- B. is more variable than the z statistic.
- C. is not normally distributed like the z statistic.
Answer: B
NEW QUESTION 453
The need for money arises when income is received only occasionally (say once a month) in discrete amounts, but expenditures occur continuously. This type of demand for money is:
- A. precautionary.
- B. speculative.
- C. transactions-related.
Answer: C
Explanation:
Money is needed to use in the purchase of goods and services.
NEW QUESTION 454
Which statement is false?
- A. Most of a wages of a fast-food restaurant worker is opportunity cost.
- B. Most of the salary earned by a superstar baseball pitcher may be economic rent.
- C. If the supply is perfectly inelastic, the supplier's entire income would be comprised of opportunity cost.
Answer: C
Explanation:
B is true. This is because the job pays minimum wage.
If the supply is perfectly elastic (NOT inelastic), the supply curve would be perfectly horizontal, and the supplier's entire income would be comprised of opportunity cost. If the supply is neither elastic nor inelastic, the supply curve will slope upward and the supplier's income would be split between economic rent and opportunity cost.
NEW QUESTION 455
A random variable, X, has a mean of 12 and a standard deviation of 14. If another variable, Y, is defined by Y = 2X - 3, the coefficient of variation of Y is ________.
- A. 1.19
- B. 0.75
- C. 1.33
Answer: C
Explanation:
You should remember two important points:
Multiplying a random variable by a constant multiplies its mean and standard deviation by the same
*
constant.
Adding a constant to a random variable increases the mean by the same constant but leaves the
*
standard deviation unchanged.
Using these two rules, the mean of Y equals 2 * 12 - 3 = 21. The standard deviation of Y equals 2 * 14 = 28.
The coefficient of variation equals the ratio of the standard deviation to the mean. Thus, the coefficient of variation of Y equals 28 / 21 = 1.33.
NEW QUESTION 456
Which of the following statements most accurately depicts bonds price volatility?
- A. During periods of increasing interest rates, high coupon bonds exhibit lower price volatility than low coupon bonds.
- B. Short maturity bonds are more volatile than long maturity bonds.
- C. Bonds with low duration are much more volatile than bonds with high duration.
Answer: A
Explanation:
When interest rates rise, all bond prices will fall. However, some bonds will fall in price at a lower rate. For instance, if a bond is paying higher coupons, these coupons may be reinvested at the new prevailing higher interest rates. This is a plus. Therefore, this beneficial feature helps to reduce the rate at which the bond price is falling.
NEW QUESTION 457
The realized mean monthly return on the S&P 500 in the 1990's appears to have been substantially different than the mean return in 2000's. The data indicate that assuming equal population variances is not unreasonable.
u = 1990's population mean return and u = 2000's population mean return. The decision made in this
1 2
hypothesis is (assume at the 10% level):
- A. not to reject the null hypothesis.
- B. that the t value is significant at 0.1 level.
- C. to reject the null hypothesis.
Answer: A
Explanation:
Pooled estimate of variance needs to be computed as follows:
2 2 2
S = [(60 - 1)(5.876) + (60 - 1)(4.986) ] / (60 + 60 - 2) = 29.694.
1/2
Now determine the value of t. t = [(0.7 - 1.8) - 0] / [29.964/60 + 29.964/60] = -1.101. We reject null if t >
1 .658 or t -1.658 (t-value: t(118, 0.05) = 1.658). The t value of -1.101 does not fit the rejection criteria. In other words we do not reject the null hypothesis and the t value is not significant at the 0.1 level.
NEW QUESTION 458
What is the annual Internal Rate of Return of this series of annual cash flows:
Year 0: $6,000>,
Year 1: $4,000,
Year 2: $3,000,
Year 3: $2,000,
Year 4: $1,000
(Note that the is used to indicate a negative number).
- A. 33.74%.
- B. 24.61%.
- C. 31.38%.
Answer: C
Explanation:
On the BAII Plus, press CF 2nd CLRWork 6000 ENTER DownArrow 4000 ENTER
DownArrow DownArrow 3000 ENTER DownArrow DownArrow 2000 ENTER DownArrow DownArrow
1 000 ENTER DownArrow DownArrow 2nd Quit. Then press Irr CPT.
On the HP12C, press these keys: 6000 CHS BlueShift CFo 4000 BlueShift CFj 3000 BlueShift CFj 2000
BlueShift CFj 1000 BlueShift CFj. Then press YellowShift Irr. The "DownArrow" represents the downward-pointing arrow on the top row of the BAII Plus keyboard. Make sure that the BAII Plus has the
P/Y value set to 1.
NEW QUESTION 459
Which of the following is INCORRECT concerning medium term notes?
- A. They have maximum maturities of up to 15 years.
- B. They were originally meant to bridge the funding gap between commercial paper and long-term bonds.
- C. They are shelf-registered.
Answer: A
Explanation:
The term medium term notes is misleading as their maturities can be very long, even greater than 30 years. Their issuance process (shelf-registration) is what distinguishes them from other bonds and notes.
NEW QUESTION 460
Beaumont Bearings is analyzing two mutually exclusive projects with the following cash flows. Its cost of capital is 9%.
The NPV of projects X and Y are
- A. X: 7,339; Y: 2,752
- B. X: 6,320; Y: 5,648
- C. X: 9,000; Y: 8,000
Answer: B
Explanation:
NPVX = -10,000 + 8,000/(1.09)1 + 7,000/(1.09)2 + 4,000/(1.09)3 = 6,320 NPVY = -5,000 +
3 ,000/(1.09)1 + 2,500/(1.09)2 + 7,500/(1.09)3 = 5,648.
NEW QUESTION 461
Higher than expected aggregate demand will result in an inflation that is like a ______ one.
- A. demand-pull.
- B. demand-push.
- C. cost-push.
Answer: A
Explanation:
If aggregate demand grows faster than expected, real GDP moves above potential GDP, the inflation rate exceeds its expected rate, and the economy behaves like it does in a demand-pull inflation.
NEW QUESTION 462
Technicians do NOT believe:
- A. Security price movements occur after fundamental developments unfold.
- B. Fundamental analysis is a key input in determining security prices.
- C. Trends and patterns are somewhat predictable.
Answer: A
Explanation:
A - They believe trends and patterns tend to repeat themselves.
B - They believe so but they also believe fundamental analysis is not the only one.
C - they believe that security price movements occur before fundamental developments unfold.
NEW QUESTION 463
Analysts should monitor the actions of standard setters and regulators because
- A. changes in regulations can affect companies' valuations.
- B. Analysts don't need to monitor such actions because any potential changes are out of their control, or because analysts are not accountants.
- C. their actions are likely to be helpful in identifying new transactions.
Answer: A
Explanation:
Changes in regulations can affect companies' financial statements and thus valuations.
NEW QUESTION 464
Unrealistically optimistic assumptions about collectability of receivables and loans is an example of
- A. Stretching accounting principles to achieve a desired outcome.
- B. Using unrealistic or inappropriate estimates and assumptions to achieve a desired outcome.
- C. Following GAAP but selecting alternatives within GAAP that bias or distort reported results to achieve a desired outcome.
Answer: B
NEW QUESTION 465
If a person earned a score higher than 35 persons in his class of 50 students, what is his percentile score?
- A. 0
- B. 1
- C. 2
Answer: B
NEW QUESTION 466
For a two-stock portfolio, what would be the preferred correlation coefficient between the two stocks?
- A. 0.00
- B. -1.00
- C. 1.00
Answer: B
NEW QUESTION 467
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For more info, read the reference:
How to Prepare For CFA CFA-Level-I: CFA Institute CFA Level I Chartered Financial Analyst Exam
Preparation Guide for CFA CFA-Level-I: CFA Institute CFA Level I Chartered Financial Analyst Exam
Introduction
The Chartered Financial Analyst is one of the most common designations for investment professionals (CFA). However, it is not for the weak of heart or people who are not interested in being a CFA cardholder. The journey to becoming a CFA holder is long and measures not only the competence but also the strength, dedication and stamina of the topic. According to the CFA Institute, the present curriculum is ideally described as a distance learning programme at its own rate which adopts a general approach to the study, evaluation and management of portfolios which highlights the highest ethical and technical expectations. The CFA curriculum includes three examinations: CFA Level I, Level II and Level III. The CFA applicants must pass both of these exams and they must fulfil certain work requirements defined by the CFA Institute. In December 2017, the progress rate for the Level I exam was 43 percent. For each of these three stages, the curriculum is designed to assess a broad range of skills that are most appropriate for investing professions. In this post, we will focus on the Level I CFA review. CFA Level 1 dumps and CFA Level 1 practice tests are designed to render the entire examination environment comfortable for the students.
The benefit of Obtaining the CFA CFA-Level-I: CFA Institute CFA Level I Chartered Financial Analyst Certification
- More profitable and more time than an MBA program
- It is a field that is evolving. In addition to the changing face of medical care in this country, the aging of the population means that there are more pharmacy patients.
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