Cfa- Test 2010 Essay

1732 Words Apr 10th, 2011 7 Pages
CFA Level I June 2010 - Mock Exam Questions
1. Which of the following least likely violates Standard VII (B): Reference to CFA Institute, the CFA Designation and the CFA Program? A. Joe Smith, C.F.A. B. Joe Smith, CFA C. Joe Smith, Chartered Financial Analyst

Answer: C   According to Standard VII (B), an analyst must not exaggerate the meaning or implications of membership of CFA Institute, holding the CFA designation, or candidacy in the CFA Program. A member cannot use a bold or larger font for the letters CFA.

2. Which of the following is least likely a characteristic of GIPS? A. The investment management firm must define the entity that claims compliance. B. All fee-paying discretionary portfolios are required to be included
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Answer: A.  The p-value is the lowest level of significance at which the null hypothesis can be rejected. At the 5% significance level the null hypothesis will be rejected as the significance level of the test is greater than the p-value (4%). We can only reject or fail to reject the null hypothesis in a hypothesis test. The null is never ‘accepted’.

6. Consider the following statements: Statement 1: The MRP of labor for a firm that is a price taker remains constant at all output levels. Statement 2: The MRP of labor for a firm that is a price searcher rises as it expands output. Which of the following is most likely? A. Both statements are correct B. Both statements are incorrect C. Only Statement 1 is correct. Answer: C

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A firm that is a price-taker faces a perfectly elastic demand curve. Since the price of its output remains constant, MRP remains constant as well. A firm that is a price-searcher faces a downward-sloping demand curve for its output. Since MR is less than price, the MRP of each additional unit of labor falls as output expands.

7. The imposition of which of the following by the government is least likely to result in a deadweight loss from underproduction? A. Taxes B. Quotas C. Subsidies Answer: C   Taxes and production quotas result in deadweight losses from underproduction. Subsidies result in deadweight losses from overproduction.

8. Consider the following two statements: Statement 1: The more

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