Updated CFA-Level-I Dumps Questions Are Available [2023] For Passing CFA Exam
Free UPDATED CFA CFA-Level-I Certification Exam Dumps is Online
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.
NEW QUESTION # 226
Darlene Mainee owns a portfolio which consists of 3 bonds. What is the duration of the bond portfolio?
- A. 6.6862
- B. 7.2661
- C. 7.0552
Answer: B
Explanation:
This calculation is very similar to a Weighted Average Cost of Capital computation. The first step requires that each bond be assessed for its relative weight in the portfolio. The corresponding weight is then multiplied by the bond's duration which provides the bond's contribution to the overall portfolio duration.
Note: While this problem provides the bond's market value (already computed) it could be left to the candidate to determine on an exam. The bond's market value is simply the bond's price (relative to par) multiplied by the corresponding par value.
The detailed computation follows: Total Market Value of Portfolio = Market value of each bond added together = $1,503,668 + $13,554,769 + $27,385,114 =$42,443,551
Next: Compute the relative weight of each bond in the portfolio. Weight of 6.00%, 2,000,000 par value bond in portfolio (duration of9.07) = Market value of Bond /Market Value of Total Portfolio = 0.035
Weight of 4.50%, 14,700,000 par value bond in portfolio (duration of 2.30)= Market value of Bond /Market
Value of Total Portfolio = 0.319
Weight of 9.00%, 20,000,000 par value bond in portfolio (duration of 9.63) = Market value of Bond /Market
Value of Total Portfolio = 0.645
The portfolio's duration equals the weighted average of each bond's duration multiplied by its weight:
0 .035 * 9.07 + 0.319 * 2.30 + 0.645 * 9.63 = 0.3212 + 0.7332 + 6.2117 = 7.2661
NEW QUESTION # 227
Assume a 30% tax rate. If the interest expense amount increases by $100, this period's FCFF will
_ ___ and FCFE will ____.
- A. decrease by $30; decrease by $30.
- B. not change; decrease by $70.
- C. increase by $30; increase by $30.
Answer: B
Explanation:
Net income will decrease by $70 (30% tax shield). As FCFF = NI + NCC + Int (1 - Tax rate) -
FCInv - WCInv, it will not change. However, as FCFE = FCFF + Net borrowing - Int ( 1- Tax rate), FCFE will decrease by $70.
NEW QUESTION # 228
Which of the following will shift the aggregate demand curve for the U.S. to the right?
- A. A decrease in the exchange rate for the euro.
- B. An economic boom in Europe.
- C. A drop in the price level.
Answer: B
Explanation:
The shift indicates an increase in aggregate demand. An economic boom in Europe would lead to higher incomes there and increased demand for U.S exports. A decreased exchange rate for euro is an increase in the exchange rate for the dollar, or an increase in interest rate would decrease aggregate demand. A drop in the price level would not shift the aggregate demand curve. It would instead cause a movement downward along the existing aggregate demand curve.
NEW QUESTION # 229
The futures exchanges industry is an industry that is ______.
- A. concentrated with strong pricing power.
- B. concentrated with weak pricing power.
- C. fragmented with strong pricing power.
Answer: A
Explanation:
There is only one major futures exchange in the U.S. - Chicago Mercantile Exchange.
NEW QUESTION # 230
At what rate of interest must I invest a sum of money if I want to double my investment in 14 years time and if the interest is compounded annually?
- A. 5.08%.
- B. 0.05076%.
- C. 0.05%.
Answer: A
Explanation:
Using Texas Instruments BA II Plus: 1 +- PV: PV = -1.00 2 FV: FV = 2.00 14 N: N = 14.00
CPT I/Y: I/Y = 5.08
Using Hewlett Packard hp 12 C: f CLEAR FIN: 0.000000000 f CLEAR REG: 0.000000000 14 n:
14.00000000 5 CHS PV: -5.00000000 15 FV: 10.00000000 i: 5.07566387
Note: You can put in any value for PV, as long as you put in twice this value for FV.
NEW QUESTION # 231
Referring to the information in the following table, if good S is capital intensive, then following the
Heckscher-Ohlin Theory,
- A. both countries will export good S.
- B. country B will export good S.
- C. country A will export good S.
Answer: B
Explanation:
Country A is relatively more labor intensive than country B
NEW QUESTION # 232
An investor owns 100 shares of General Motors stock. She sells one stock call option. The investor's position is now a covered call with the following characteristics:
Stock position: LONG 100 shares of General Motors Stock purchase price: $62.00 per share Option position: SHORT 1 call option General Motors stock Underlying asset: 100 shares of General Motors
Exercise price: $80.00 per share Premium: $0.13 per share Expiration date: October
If the expiration-day price of General Motors stock were $82.00 per share, then the expiration-day profit/loss for the covered call would be:
- A. + $20.00 - $0.00 - $0.13 = $19.87
- B. + $20.00 -$2.00 + $0.13 = $18.13
- C. + $20.00 - $0.00 + $0.13 = $20.13
Answer: B
Explanation:
(ST - St) - MAX(0, ST - X) + Ct = (82.00 - 62.00) - MAX (0, 82.00 - 80.00) + .13= 20.00 - MAX
(0, 2.00) + .13 = 20.00 - 2.00 + .13 =
NEW QUESTION # 233
Andrea Palmer has saved 25,000 in her bank account. She is thinking of moving it to a money market account that pays a fixed 3.75% stated annual rate, compounded monthly. If Andrea continues to save 600 per month for the next three years, every month-end from her salary, how much money will she have after three years?
- A. 50,912
- B. 50,796
- C. 46,917
Answer: B
Explanation:
Andrea has 25,000 today and will save 600 monthly at year-end. The latter is an annuity.
The future value of both can be computed in one step on a financial calculator. Interest = 3.75/12 =
0 .3125%, since compounding is monthly. In the BGN mode: PV = 25,000; N = 36; I/Y = 0.3125; PMT =
6 00; CPT FV = 50,796.
NEW QUESTION # 234
Suppose you were told that scores on an examination were converted to standard scores with a mean = 500, range of 800, and a standard deviation of 100. A person with a score of 600 has performed better than what percent of the persons taking the test?
- A. 84 percent
- B. 97.5 percent
- C. 57 percent
Answer: A
Explanation:
Z = (X - MU)/Standard Deviation Z = (600 - 500)/100 = 1 Area between Z and Mean = .3413
Area to Left of Z = .5 + .3413 = .8413 Percentile Rank = 100*.8413 = 84.13 Therefore, the person has performed better than 84 percent of the people.
NEW QUESTION # 235
Suppose the quantity of x is measured on the horizontal axis. If the income consumption curve is vertical, then the income elasticity of demand for x is
- A. 0
- B. 1
- C. 2
Answer: A
NEW QUESTION # 236
Which of the following statement(s) is (are) true with respect to constructing the proper objectives for an investor?
I). The required rate of return that an investor demands will determine how much risk the manager should take.
II). As the client's risk aversion increases, the manager may include more aggressive investments in the portfolio.
III). If the investor's objective is heavily focused towards income, then it would not be prudent to include securities that are growth oriented into the portfolio.
IV). An account that will need to generate income in step with inflation must be measured in terms of real performance.
- A. I and III.
- B. II and IV.
- C. IV only.
Answer: C
Explanation:
I is false because the amount of risk an investor is willing to take will establish what kinds of return can be realistically expected to be earned from the portfolio.
II is incorrect because as the client's risk aversion increases, the manager must include more conservative investments in the portfolio. Candidates must be careful not to confuse risk aversion with risk tolerance, as these two terms have opposite meanings.
As intuitive as III sounds, it may be very prudent to include growth securities in a portfolio that requires income. The reason - it is total return that matters, and not specifically its two components of income and growth.
NEW QUESTION # 237
Which of the following is most likely incorrect?
- A. Giving all client accounts participating in a block trade the same execution price and charging the same commission is recommended for compliance with Standard III (B) Fair Dealing.
- B. Processing and executing orders on a first-in, first-out basis is recommended for compliance with
Standard III (B) Fair Dealing. - C. Processing and executing orders on a first-in, first-out basis is recommended for compliance with
Standard IV (C) Responsibilities of Supervisors.
Answer: C
Explanation:
Processing and executing orders on a first-in, first-out basis is required by Fair Dealing rather than Responsibilities of Supervisors.
NEW QUESTION # 238
What is the yield to first par call of a 20-year, 8.5% bond with a market price of $104.95, if the first par call date is in 15 years?
- A. 8.20%
- B. 8.50%
- C. 7.93%
Answer: C
Explanation:
N=30, PV = -104.95, PMT = 4.25, FV = 100, I/Y =?= 3.965, YTM = 3.965(2) = 7.93%
NEW QUESTION # 239
As the alternative mean approaches the hypothesized mean, what can we say about the risk?
- A. Smaller risk of a Type II error
- B. Smaller risk of a Type I error
- C. Greater risk of a Type II error
Answer: C
Explanation:
When the alternative mean approaches the hypothesized mean, there is a greater possibility of accepting the null when it is actually false since they are close together.
NEW QUESTION # 240
If you write a put option to sell a stock at $30 in 30 days, your option position is ______ and your exposure to the risk of the stock is ______.
- A. short, long.
- B. short, short.
- C. long, short.
Answer: A
Explanation:
The put contract holder, on the contrary, has long exposure to the option contract and short exposure to the stock.
NEW QUESTION # 241
The convexity adjustment for a callable bond with a duration of 5.5 and convexity of -38, when the interest shock is 250 basis points, is:
- A. -2.375
- B. -11.375
- C. -16.125
Answer: A
Explanation:
Convexity adjustment = -38(.025)(.025) 100 = -2.375
NEW QUESTION # 242
Mike is a real estate broker and recently he helped John purchase a 5-year-old house in New York for
$ 300,000, making $12,000 (excluded in the $300,000 house price) as his commission. The amount counted towards US GDP should be
- A. $12,000 commission only.
- B. $0, since the house is old.
- C. $312,000, the total price John paid.
Answer: A
Explanation:
Transactions involving the exchange of goods or assets produced during previous periods are not included since they don't reflect current production. However, Mike provided services to arrange the sale and the $12,000 commission should be counted.
NEW QUESTION # 243
The clearinghouse is:
- A. closely associated with the futures exchange
- B. an independent entity with no ties to the futures exchange
- C. a department of the Federal Reserve
Answer: A
Explanation:
The clearinghouse is not an agency of the U.S. government. It is closely tied to the exchange and must cooperate closely with its associated exchange.
NEW QUESTION # 244
To determine the plan assets and plan liabilities, an analyst should refer to the:
- A. Statement of stockholders' equity.
- B. Balance sheet.
- C. Footnotes.
Answer: C
Explanation:
The balance sheet reports a company's net funded position, with the separate components, i.e. plan assets and plan liabilities, disclosed in the footnotes.
NEW QUESTION # 245
If a firm observes that the marginal revenue product of labor exceeds the wage at the current level of hours, the firm is likely to
- A. decrease the hours of labor.
- B. raise wages.
- C. increase the hours of labor.
Answer: C
Explanation:
The firm will maximize profits when marginal revenue product is equal to the wage. Since marginal revenue product is decreasing, if it is greater than the wage the firm can increase profits through increasing labor hours.
NEW QUESTION # 246
......
CFA Level I exam, offered by the CFA Institute, is the first step in the prestigious Chartered Financial Analyst (CFA) program. CFA-Level-I exam is a comprehensive assessment of a candidate's knowledge and understanding of investment tools, ethical and professional standards, and quantitative methods. Passing the CFA Level I exam is a significant accomplishment as it is widely recognized as one of the most difficult and rigorous financial exams in the world.
Passing the CFA-Level-I exam is an important milestone for financial professionals who wish to advance their careers. CFA-Level-I exam is highly respected in the industry and is often seen as a prerequisite for positions in investment banking, asset management, and other areas of finance. Candidates who pass the exam are also eligible to move on to the next level of the CFA program.
CFA Exam 2023 CFA-Level-I Dumps Updated Questions: https://www.prep4sureguide.com/CFA-Level-I-prep4sure-exam-guide.html
Get The Most Updated CFA-Level-I Dumps To CFA Level Certification: https://drive.google.com/open?id=1LEPc335Af7J3gll_etv1fVcszIjfSqca