Pass Your CFA-Level-I Exam at the First Try with 100% Real Exam Questions
New CFA CFA-Level-I Dumps & Questions Updated on 2024
NEW QUESTION # 230
Under rather restrictive assumptions, the equilibrium static efficiency conditions of the purely competitive model are
- A. inefficient, but they will lead to an equitable distribution of income.
- B. ideal from society's viewpoint.
- C. efficient in the short run, but they will lead to inefficiency in the long run.
Answer: B
Explanation:
The purely competitive model implies allocative efficiency which is an ideal condition from society's viewpoint.
NEW QUESTION # 231
What order instructions indicate how to fill an order?
- A. Execution instructions.
- B. Validity instructions.
- C. Clearing instructions.
Answer: A
Explanation:
Validity instructions indicate when to fill an order, and clearing instructions indicate how to settle the trade.
NEW QUESTION # 232
A 10 year, 8% coupon bond has a price of 97.21 of 100 par. If its effective duration is 4.9 and the yields increase by 0.35%, what is the bond's new price, as estimated by its duration?
- A. 98.88
- B. 95.54
- C. 98.12
Answer: B
Explanation:
The percentage price change %*P = -4.9 * 0.0035 = -1.715%.The estimated price: P1 = P0
(1 + %*P) = 97.21 (1 - 0.01715) = 95.54.
NEW QUESTION # 233
Key steps in the dynamic process of portfolio management are:
I). Specification of investor objectives, constraints, and preferences.
II). Asset allocation, portfolio optimization, security selection, implementation, and execution.
III). Determination of capital market expectations.
IV). Measurement of portfolio performance.
The order of these steps in the process is:
- A. I, III, II, IV.
- B. I, II, III, IV.
- C. III, I, IV, II.
Answer: A
NEW QUESTION # 234
If a 20-day moving average is crossing from above a 60-day moving average, the movement is known as a:
- A. good cross.
- B. dead cross.
- C. golden cross.
Answer: B
Explanation:
When a short-term moving average crosses from above a longer-term moving average it is called a dead cross.
NEW QUESTION # 235
All of the following statements are true with respect to the effects of changing interest rates on the market value of debt and on financial statements and ratios, except:
- A. if the company was to buy back its bonds at a discount to its book value, then it would have to record an extraordinary gain.
- B. only when interest rates drop and the value of the outstanding debt increases, would the firm be required to revalue the book value of its debt.
- C. financial ratios will not be impacted by changes in market interest rates.
Answer: B
Explanation:
The book value of the debt would not be impacted by what is prevailing in the markets. Thus, even as the market value of a firm's bond fluctuate by the hour, it will have no impact on the debt's book value.
NEW QUESTION # 236
What is the future value of the following regular (ordinary, deferred) annuity?
Payment amount = $100 Payment frequency = annual, at the end of each year Number of payments = 20
Interest rate = 8% per year.
- A. $4,750.00
- B. $4,576.20
- C. $2,160.00
Answer: B
Explanation:
19 18 17 1 0
FV = 100(1.08) + 100(1.08) + 100(1.08) + ... + 100(1.08) + 100(1.08) = $4,576.20
NEW QUESTION # 237
You have a portfolio of 4 stocks, A, B, C and D.
Exactly 25% of your capital is invested in each stock.
E(RA) = 15%, E(RB) = 12%, E (RC) = 10% and E(RD) = 8%. The expected return on the portfolio is:
- A. 11.25%.
- B. 10.75%.
- C. 12%.
Answer: A
Explanation:
0.25 x 15% + 0.25 x 12% + 0.25 x 10% + 0.25 x 8% = 11.25%.
NEW QUESTION # 238
The par value of a bond is
- A. the amount the issuer agrees to repay the bondholder by the maturity date.
- B. the right of the issuer to retire the issue prior to the stated maturity date.
- C. the number of years over which the issuer has promised to meet the conditions of the obligation.
Answer: A
Explanation:
The par value of a bond is the amount the issuer agrees to repay the bondholder by the maturity date.
NEW QUESTION # 239
If a lessor appropriately classifies a lease as a sales-type lease, the following items related to the lease should be reported on the lessor's income statement in the first year of the lease:
I). Rental Revenue
II). Interest Revenue
III). Depreciation Expense
IV). Income (loss) on Sale of Leased Property
- A. II, III, and IV only
- B. II and IV only
- C. I and III only
Answer: B
Explanation:
Rental revenue is only recognized in an operating lease. If it is a sales-type lease, there is profit on the sale as well as the interest revenue on the receivable. As the lessor no longer reports the asset on its records, it does not record depreciation on it.
NEW QUESTION # 240
Which of the following industries is/are most likely to be regarded as growth?
- A. Food.
- B. Beer.
- C. None of them.
Answer: C
NEW QUESTION # 241
I). The generally accepted accounting principle (GAAP) that determines when revenue should be recorded in the accounting records is called the realization principle.
II). The generally accepted accounting principle (GAAP) that determines when expenses should be recorded in the accounting records is called the realization principle.
- A. both are true.
- B. only I is true.
- C. both are false.
Answer: B
Explanation:
I). The realization principle determines when revenue should be recorded in the accounting records. Revenue is realized when services are rendered to customers or when goods sold are delivered to customers.
II). The matching principle is the generally accepted accounting principle that determines when expenses should be recorded in the accounting records. The revenue earned during an accounting period is matched (offset) with the expenses incurred in generating this revenue.
NEW QUESTION # 242
Which of the following should be classified as investing cash flow?
I). purchase and sale of debt of other entities.
II). purchase and sale of equity securities of other entities.
III). loans to other entities and collection of loans to other entities.
IV). issuance and redemption of debt (bonds and notes).
V. issuance of equity securities and reacquisition of capital stock.
- A. I, II and III.
- B. I and II.
- C. II and V.
Answer: A
Explanation:
Purchase of debt and equity securities of other entities (sale of debt or equity securities of other entities), loans to other entities (collection of loans to other entities) are considered investing activities. However, issuance of debt (bonds and notes) and equity securities are financing cash inflows, and payment of dividend, redemption of debt, and reacquisition of capital stock are financing cash outflows.
NEW QUESTION # 243
Empirical studies of mutual fund performance indicate that:
- A. more aggressive funds do not have higher risk
- B. selection of benchmark does not influence results
- C. an index-based strategy provides better results than most actively managed portfolios
Answer: C
Explanation:
Empirical evidence finds that funds using a buy-and-hold, or index, strategy offer the highest risk-adjusted returns. This suggests that most mutual fund managers do not have forecasting ability that can provide risk-adjusted returns above the market averages. The poor risk-adjusted performance of actively managed funds has led to the recent introduction and widespread acceptance of several mutual funds indexed to broad market averages.
NEW QUESTION # 244
A percentile score of 40 indicates that a person
- A. knows 40% of the material covered by the examination;
- B. has earned a score equal to or better than 40% of the people in his class.
- C. answered 40% of the questions correctly on the test;
Answer: B
NEW QUESTION # 245
In which of the following markets are economic profits zero in the long run?
I). price-taking markets
II). monopolistically competitive markets
III). contestable markets
- A. I, II and III.
- B. I and II.
- C. I and III.
Answer: A
Explanation:
In all of these markets, barriers to entry and exit are low so that abnormal economic profits cannot prevail for very long. In the long run, economic profits in all of these markets equal zero so that the firm earn only the normal rate of return on their resources.
NEW QUESTION # 246
Operating income from discontinued operations, and any gains or losses from their sale are
- A. not reported on the income statement but reflected in the footnotes.
- B. segregated in the income statement.
- C. reported after extraordinary items on the income statement.
Answer: B
Explanation:
Operating income from discontinued operations, and any gains or losses from their sale are segregated in the income statement.
NEW QUESTION # 247
Bridget's Midget Widget
Gross Profit has:
- A. Increased over the period because cost of goods sold has increased less rapidly than sales.
- B. Decreased in dollars, but increased as a percent of sales.
- C. Decreased over the period.
Answer: A
NEW QUESTION # 248
A reduction in the valuation allowance will:
I). reduce reported income taxes.
II). reduce actual income taxes.
III). reduce accounting income.
IV). increase accounting income.
- A. I and IV.
- B. II and IV.
- C. I and III.
Answer: A
Explanation:
Actual income taxes are never affected by a change in valuation allowance established for financial reporting.
NEW QUESTION # 249
The following figure shows Bobby's indifference map for soda and juice. B1 indicates his original budget line. B2 indicates his budget line resulting from an increase in the price of soda. From the graph, one can conclude that
- A. Bobby views soda as a normal good.
- B. Bobby views soda as an inferior good.
- C. the income elasticity of demand for soda is 1.
Answer: A
Explanation:
Bobby will consume more soda if his income increases.
NEW QUESTION # 250
......
CFA-Level-I exam is widely recognized as one of the most challenging professional exams in the financial industry. According to the CFA Institute, the pass rate for the CFA-Level-I exam is typically between 40% and 50%, which means that many candidates must take the exam multiple times before passing. However, earning the CFA designation can open up a wide range of career opportunities in the financial industry, including roles in investment banking, asset management, and equity research.
Updated Exam CFA-Level-I Dumps with New Questions: https://www.dumpsreview.com/CFA-Level-I-exam-dumps-review.html
Dumps to Pass your CFA-Level-I Exam with 100% Real Questions and Answers: https://drive.google.com/open?id=1kj3UA_vCqkzgqg9mwYzzPyjQu1N6eORj
