CFA Level 1 Concepts- -Complete Exam
Study Guide with Verified Answers |
Guaranteed A+
Book Value per Share = ------- ✔ CORRECT ANSWER ✓✓= (Total Assets - Intangible Assets -
Liabilities)
Under US GAAP PP&E asset is tested for impairment when... ------- ✔ CORRECT ANSWER
✓✓events and circumstances indicate the firm may not recover its carrying value through future
use, or if the asset is reclassified from held-for-use to held-for-sale
Index returns for alternative investments are often subject to 2 types of bias? ------- ✔ CORRECT
ANSWER ✓✓Backfill and survivorship bias
A natural monopoly is... ------- ✔ CORRECT ANSWER ✓✓A monopoly situation in which the
average total cost of production continually declines with increased output
Under IFRS PP&E asset is tested for impairment.... ------- ✔ CORRECT ANSWER ✓✓At least
annually despite circumstances
Data snooping bias can result when... ------- ✔ CORRECT ANSWER ✓✓the same data is used
with different methods until the desired results are obtained
Selling costs are expensed ------- ✔ CORRECT ANSWER ✓✓in the period incurred since they
result in no future benefit (i.e. the inventory has been sold)
,Tokenization refers to... ------- ✔ CORRECT ANSWER ✓✓maintaining ownership records for
physical assets on a distributed ledger
In a market of perfect competition an individual firm's demand schedule (demand curve)... ------
- ✔ CORRECT ANSWER ✓✓Is perfectly elastic (horizontal)
Demand-pull inflation can result from any factor that.... ------- ✔ CORRECT ANSWER
✓✓increases aggregate demand, including increases in the money supply, increases in exports,
and increases in government purchases
A crossing network is an example of which type of market... ------- ✔ CORRECT ANSWER
✓✓Order-Driven market
Smart contracts are... ------- ✔ CORRECT ANSWER ✓✓computerized agreements designed to
automatically carry out certain actions if defined conditions are met
Under the fair value model for investment property, unrealized gains and losses are recognized
on... ------- ✔ CORRECT ANSWER ✓✓The income statement
Stratified sampling is most often used for which type of security index ------- ✔ CORRECT
ANSWER ✓✓Bond index (bond portfolio)
(True or false) Refusing to cooperate with a CFA Institute investigation of a member's behavior
could lead to suspension of membership or participation in the CFA Program ------- ✔ CORRECT
ANSWER ✓✓True
Market share and operating efficiency are more of a focus for firms that pursue a...
(differentiation or low cost strategy) ------- ✔ CORRECT ANSWER ✓✓low cost strategy
, Behind the market means ------- ✔ CORRECT ANSWER ✓✓Market price is above of specific
entry price
Standard error of sample formula... ------- ✔ CORRECT ANSWER ✓✓Standard error = Pop.
STD/sq.r. sample
Infrequent valuation results in downward bias... ------- ✔ CORRECT ANSWER ✓✓in both
standard deviations and correlations
recommended method is to treat flotation costs as a... ------- ✔ CORRECT ANSWER ✓✓Cash
outflow at project initiation
One assumption of linear regression is that the error terms are that... ------- ✔ CORRECT
ANSWER ✓✓Independently distributed & the correlations between error terms are expected to
be zero
Unlike most alternative investments, expected returns on commodities have typically (higher or
lower) expected returns relative to traditional investments ------- ✔ CORRECT ANSWER
✓✓Lower expected return. Also, have low correlation to traditional investments therefore add
less variability in a portfolio
Compared to a competitive market, a monopoly situation will produce... ------- ✔ CORRECT
ANSWER ✓✓less output, and the sum of the consumer surplus and the producer surplus will be
reduced
Interest expense equals... ------- ✔ CORRECT ANSWER ✓✓coupon % * price of bond
Study Guide with Verified Answers |
Guaranteed A+
Book Value per Share = ------- ✔ CORRECT ANSWER ✓✓= (Total Assets - Intangible Assets -
Liabilities)
Under US GAAP PP&E asset is tested for impairment when... ------- ✔ CORRECT ANSWER
✓✓events and circumstances indicate the firm may not recover its carrying value through future
use, or if the asset is reclassified from held-for-use to held-for-sale
Index returns for alternative investments are often subject to 2 types of bias? ------- ✔ CORRECT
ANSWER ✓✓Backfill and survivorship bias
A natural monopoly is... ------- ✔ CORRECT ANSWER ✓✓A monopoly situation in which the
average total cost of production continually declines with increased output
Under IFRS PP&E asset is tested for impairment.... ------- ✔ CORRECT ANSWER ✓✓At least
annually despite circumstances
Data snooping bias can result when... ------- ✔ CORRECT ANSWER ✓✓the same data is used
with different methods until the desired results are obtained
Selling costs are expensed ------- ✔ CORRECT ANSWER ✓✓in the period incurred since they
result in no future benefit (i.e. the inventory has been sold)
,Tokenization refers to... ------- ✔ CORRECT ANSWER ✓✓maintaining ownership records for
physical assets on a distributed ledger
In a market of perfect competition an individual firm's demand schedule (demand curve)... ------
- ✔ CORRECT ANSWER ✓✓Is perfectly elastic (horizontal)
Demand-pull inflation can result from any factor that.... ------- ✔ CORRECT ANSWER
✓✓increases aggregate demand, including increases in the money supply, increases in exports,
and increases in government purchases
A crossing network is an example of which type of market... ------- ✔ CORRECT ANSWER
✓✓Order-Driven market
Smart contracts are... ------- ✔ CORRECT ANSWER ✓✓computerized agreements designed to
automatically carry out certain actions if defined conditions are met
Under the fair value model for investment property, unrealized gains and losses are recognized
on... ------- ✔ CORRECT ANSWER ✓✓The income statement
Stratified sampling is most often used for which type of security index ------- ✔ CORRECT
ANSWER ✓✓Bond index (bond portfolio)
(True or false) Refusing to cooperate with a CFA Institute investigation of a member's behavior
could lead to suspension of membership or participation in the CFA Program ------- ✔ CORRECT
ANSWER ✓✓True
Market share and operating efficiency are more of a focus for firms that pursue a...
(differentiation or low cost strategy) ------- ✔ CORRECT ANSWER ✓✓low cost strategy
, Behind the market means ------- ✔ CORRECT ANSWER ✓✓Market price is above of specific
entry price
Standard error of sample formula... ------- ✔ CORRECT ANSWER ✓✓Standard error = Pop.
STD/sq.r. sample
Infrequent valuation results in downward bias... ------- ✔ CORRECT ANSWER ✓✓in both
standard deviations and correlations
recommended method is to treat flotation costs as a... ------- ✔ CORRECT ANSWER ✓✓Cash
outflow at project initiation
One assumption of linear regression is that the error terms are that... ------- ✔ CORRECT
ANSWER ✓✓Independently distributed & the correlations between error terms are expected to
be zero
Unlike most alternative investments, expected returns on commodities have typically (higher or
lower) expected returns relative to traditional investments ------- ✔ CORRECT ANSWER
✓✓Lower expected return. Also, have low correlation to traditional investments therefore add
less variability in a portfolio
Compared to a competitive market, a monopoly situation will produce... ------- ✔ CORRECT
ANSWER ✓✓less output, and the sum of the consumer surplus and the producer surplus will be
reduced
Interest expense equals... ------- ✔ CORRECT ANSWER ✓✓coupon % * price of bond
