CFA一级历年模拟考试(2015-2019)：2016-CFA-Level-1-Mock-Exam-afternoon-questions-removed

level1-Mock-114HYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKHYPERLINKWhatshouldInksterlikelydotoavoidviolatinganyInstituteStandardsofProfessionalConduct?A.AcceptthepositionandrevisethemarketingmaterialB.AcceptthepositionandinformseniormanagementofinadequatecomplianceproceduresC.Declinetoacceptthenewposition15.MariamMusa,headofcomplianceatDunfieldBrokers,questionshercolleagueKassim,acandidateandaresearchanalyst,abouthispurchaseofsharesinacompanyforhisownaccountimmediatelybeforehepublishesa"buy"recommendation.HedefendshisactionsbystatinghehasdonenothingwrongbecauseDunfielddoesnothaveanypersonaltradingpoliciesplace.TheInstituteStandardsofProfessionalConductwerelikelyviolatedby:A.bothMusaandKassim.B.onlyKassim.C.onlyMusa.16.Asaconditionofhisemploymentwithaninvestmentbank,AbasiHasina,wasrequiredtosignanemploymentcontract,includinganon-competeclauserestrictinghimfromworkingforacompetitorforthreeyearsafterleavingtheAfteroneHasinaquitshisjobforacomparablepositionwithinvestmentbankacountrywherenon-competeclausesareillegal.Lawyerswithwhomheconsultedpriortotakingthenewpositiondeterminedthenon-competeclausewasaviolationofhumanrightsandthusillegal.DidHasinamostlikelyviolatetheInstituteCodeofEthicsandStandardsofProfessionalConduct?A.sB.No,becausethenon-competeclauseisillegalthenewcountryofemploymentC.No,becausethenon-competeclauseviolateshisrights17.Staal,isaninvestmentinabanktrustdepartment.Shemanagesmoney7/41level1-Mock-114forcelebritiesandpublicfigures,includinginfluentiallocalpolitician.receivesarequestfromthepolitician'spoliticalpartyheadquarterstodisclosehisstockholdings.Therequestindicateslocallawrequiresthedisclosure.WhatstepsshouldStaallikelytakeensureshedoesnotviolateanyInstituteStandardsofProfessionalConduct?A.Providetheinformationandinformherclient.B.Checkwithherfirm'scompliancedepartmenttodetermineherlegalresponsibilities.C.Sendtherequesteddocumentsandinformher18.BenefitsofcompliancewiththeInstituteGlobalInvestmentPerformanceStandards(GIPS)leastlikelyinclude:A.eliminationofin-depthduediligenceforinvestors.B.participationincompetitivebidding.C.strengtheningofinternalcontrols.8/41level1-Mock-114Questions19~32RelateQuantitativeanalysis19.Theconfidenceintervalismostlikelybe:A.widerasthepointestimateincreases.B.narrowerasthereliabilityfactordecreases.C.widerasthesamplesizeincreases.20.Forapositivelyskewedunimodaldistribution,whichofthefollowingmeasuresisaccuratelydescribedastheA.MeanB.MedianC.Mode21.Ahypothesistestfailsrejectafalsenullhypothesis.Thisresultisbestdescribedasa:A.testwithlittleB.IC.II22.Consideratwo-tailedtestofthehypothesisthatthepopulationzero.samplehas50observations.populationisnormallydistributedwithaknownvariance.t-DistributionDegreesoffreedomp=0.10p=0.051.677p=0.0252.010491.299501.2991.6762.009z-Distributionα=0.101.645α=0.051.960α=0.0252.330Ata0.05significancelevel,therejectionpointsaremostlikelyat:A.–2.010and2.010.B.–2.009and2.009.C.–1.960and1.960.9/41level1-Mock-11423.ThevarianceofreturnsofAssetAis625.varianceofreturnsofAssetBis1,225.ThecovarianceofreturnsbetweenAssetAandAssetBis600.ThecorrelationofreturnsbetweenAssetAandAssetBisclosestto:A.0.29.B.0.69.C.0.47.24.Ifthedistributionofthepopulationfromwhichsamplesofsizenaredrawnispositivelyskewedandgiventhatthesamplesize,n,isthesamplingdistributionofthemeansislikelyhavea:A.varianceequaltothatoftheentirepopulation.B.meansmallerthantheoftheentirepopulation.C.distributionthatisapproximatelynormal.25.Apricerangeinwhichsellingisstoptheriseinpriceisbestdescribedas:A.changeinB.support.C.resistance.26.Atwo-tailedt-testofthehypothesisthatthepopulationmeanfromzerohasap-valueof0.0275.Usingasignificancelevelof5%,theappropriateconclusionis:A.toacceptthenullhypothesis.B.thatthechosensignificancelevelistoohigh.C.torejectthenullhypothesis.27.Aone-tailedhypothesistestinghasap-valueateststatisticof3%.Ananalystwouldnotrejectthenullhypothesisatasignificancelevelof:A.0.01.B.0.10.C.0.05.10/41level1-Mock-11428.Onceinvestorchoosesaparticularcourseofaction,thevaluefromalternativeactionsisbestdescribedasa(n):A.opportunitycost.B.requiredreturn.C.sunkcost.29.Aportfoliomanagerestimatestheprobabilitiesofthefollowingeventsforamutualfund:EventA:thefundwillearnareturnof5%.EventB:thefundwillearnareturnbelow5%.Theleastappropriatedescriptionoftheeventsisthattheyare:A.mutuallyexclusive.B.exhaustive.C.dependent.30.Independentsamplesdrawnfromnormallydistributedpopulationsexhibitthefollowingcharacteristics:SampleSizeSampleMeanSampleStandardDeviationAB25182001854560Assumingthatthevariancesoftheunderlyingpopulationsareequal,thepooledestimateofthecommonvarianceis2,678.05.t-teststatisticappropriatetotestthehypothesisthatthepopulationmeansareequalclosestto:A.0.94.B.1.90.C.0.29.31.Useofanonparametrictestisappropriatewhenthe:A.populationvarianceisunknown.level1-Mock-114B.dataaregiveninranks.C.distributionissymmetrical.32.Samplesofsize(n,n)aredrawnrespectivelyfromtwopopulations(X,X)withassociated1212and(s.s)andassociatedpopulationXX1sampleandstandarddeviationsof212meansandstandarddeviationsof(μ,μ)and(σ,σ)where.Inaddition,disthe121212sampleofX-Xwithastandarderrorofsandapopulationofand2iss12dd0papooledestimatorofthecommonvariance.TheappropriateteststatistictodeterminetheequalityofthetwopopulationassumingXandXareindependentandnormallydistributedis:12dd0A.tsdXX12122B.C.tt2p2pssnn21XX1212222ss1112/41level1-Mock-114Questions33~44RelateEconomics33.First-degreepricediscriminationisbestdescribedaspricingthatallowsproducerstoincreasetheireconomicprofitwhileconsumersurplus:A.increases.B.iseliminated.C.decreases.34.Thefollowingdataapplytoacountryinitsdomesticcurrencyunits:Consumerspendingongoodsand875,060servicesGovernmentspendingongoods305,600andservicesBusinessgrossfixedinvestment286,400Governmentinvestmentgrossfixed84,120ChangeininventoriespaymentsExports-68,5009,300CapitalconsumptionallowanceStatisticaldiscrepancyImports8,540-2,850250,980219,800Usingtheexpendituresapproach,thecountry'sGDPisclosestto:A.1,451,500.B.1,466,490.C.1,448,650.35.Cost–pushinflationisleastlikelytobebyanincreasein:A.finishedgoodsprices.B.employeewages.C.commodityprices.36.Thefollowingdiagramillustratesamarketthathadbeeninequilibriumat(P,Q)priortotheEEimpositionofapriceceiling,P.ThedeadweightlossthatarisesbecauseofthismarketCinterventionisbestdescribedbytheareadefinedby:13/41level1-Mock-114A.d+b.B.d+g.C.d+e.37.itsexistingproductionfacilities,amonopolistfirmcanproduceupto100units.Itfacesthefollowingdemandandcostschedules:Output(units)Price($/unit)Costs03,0002,8002,6002,4002,2002,0006002040608010010,60032,60066,600170,600Theoptimaloutputlevelforthisproducer(inunits)isclosestto:A.20.B.100.C.60.38.Whichcharacteristicisafirmleastlikelytoexhibitwhenitoperatesinamarketwithadownwardslopingdemandcurve,competitors,andzeroeconomicprofitsinthelongrun?A.Differentiatedproduct14/41level1-Mock-114B.LowbarriersentryC.Nopricingpower39.Anincreaseincurrentpriceswilllikely:A.decreaserealB.increaserealC.increasetheGDP40.Inorderreduceatradedeficit,thegovernmentofacountryexperiencingfullemploymentmovestodepreciateitsAsaresult,ifthecountry'sdomesticspendingdeclinesrelativetoincome,thelikelymechanismthatcausesthisoccuristhe:A.wealthB.substitutionC.incomeeffect.41.GiventhefunctionI=QP+QP,whereQrepresentsthequantitydemandedofgoodXXYYXisthepriceperunitofgoodX,Iisconsumers'income,andPyisthepriceperunitofgoodthelikelycauseofashiftinthedemandcurveisachangein:A.Px.B.C.QX42.Themarketstructurewhichafirmsellsalloftheproductproducesatthemarketequilibriumpriceisbestdescribedas:A.B.perfectcompetition.C.monopolisticcompetition.43.Thetwodominantsupermarketchainstheareaattemptingincreasetheirmarketsharebymovingto24-hourserviceinsteadofclosingat9p.m.everynight.Thestrategicoutcomes15/41level1-Mock-114andmatrixthatarisefromtheiractionsaredepictedinthediagram(withtheshadedsectionsrepresentingforChain2).AccordingNashequilibrium,thebeststrategyisfor:A.bothchainstoopen24hours.B.onlyChain2openfor24hours.C.bothchainstoclose9p.m.44.Thefollowingequationshavebeendevelopedforacompany:DemandcurveP1505QrevenuecurveMarginalrevenuecurvecostcurveQ5Q2QQ3Q73Q2costcurveQ120/QQ2Marginalcostcurve3QQ2P:priceperunitQ:costperunitTheprofitmaximizingoutputforthisfirm(inunits)isclosestto:A.7.B.C.8.16/41level1-Mock-114Questions45~68RelateFinancialStatementAnalysis45.Ifacompanyhasadeferredtaxassetreportedonitsstatementoffinancialpositionandthetaxauthoritiesreducethetaxrate,whichofthefollowingstatementsismostaccurateconcerningtheofthechange?existingdeferredtaxassetwill:A.notbeB.increaseinvalue.C.decreaseinvalue.46.Acompanyissellingalong-livedassetwithacarryingamountof$70,000for$80,000.Theoriginalcostofthisassetwas$120,000.Intheyearofsale,thiseventislikelytobereportedontheincomestatementas:A.revenuesof$80,000.B.alossof$40,000.C.againof$10,000.47.Thefollowingitemsarefromacompany'scashflowstatement.ClassificationofCashFlowDescriptionAmount(£thousands)55,000OperatingactivitiesInvestingactivitiesFinancingactivitiesCashreceivedfromcustomersInterestanddividendsreceivedNetrepaymentofrevolvingcreditloan10,00012,000Whichofthefollowingstandardsandformatsdidthecompanylikelyusethepreparationofitsfinancialstatements?A.IFRS,indirectformatB.EitherIFRSorUSdirectC.IFRS,directformat48.Whichofthefollowingstatementsisaccurateregardingcashflowstatements?A.UnderIFRS,theindirectmethodofpreparationisencouraged.B.UnderIFRS,interestpaidcanbereportedeitherasanoperatingorasinvestingcash17/41level1-Mock-114C.UnderUSbankoverdraftsshouldbeclassifiedafinancingcash49.Thefollowinginformationavailableaboutacompanyforitscurrentfiscalyear:Accountingprofit(earningsbeforetaxes)income$250,000$215,00030%rateIncometaxespaidyearDeferredtaxstartofyearDeferredtaxendofyear$61,200$82,400$90,650Theincometaxexpensereportedonthecurrentstatementofearningsisclosestto:A.$69,450.B.$64,500.C.$72,750.50.TheSEC'sapproachtoaddressingthesignificantdifferencesinfinancialreportingunderInternationalFinancialReportingStandards(IFRS)andUSGAAPisbestdescribedas:A.publiclyadvocatingforglobalaccountingstandardsandconvergence.B.mandatingthatnon-USissuersprovideareconciliationUSC.requiringissuerstoprovidedisclosuresdescribingkeydifferences.51.Acompanyhasabuildingwithanetcarryingamountof$100,000andataxbaseof$120,000Thetaxrate20%whentheassetwaspurchased,butisscheduledbereduced17%thisWhichofthefollowingwillthecompanymostlikelyreportrelatedtothisbuilding?A.Deferredtaxliability:$600B.Deferredtaxasset:$3,400C.Deferredtaxasset:$4,00052.Theanalyticaltoolthatwouldbeappropriateforananalystuseidentifythe18/41level1-Mock-114percentageofacompany'sassetsthatareliquidisthe:A.common-sizebalancesheet.B.cashratio.C.currentratio.53.Becauseofsignificantchangesthemarketplace,thedemandforaproducthasfallenandisnotexpectedrecoverpreviouslevels.Thefollowinginformationisrelatedtothepatentunderwhichtheproductisproduced:ItemDescription$Thousands36,000CarryingvalueamountUndiscountedexpectedfuturecashflowsPresentvalueofexpectedfuturecashflowsFairvalueifsold38,00032,00034,000Coststosell4,000Whichofthefollowingstatementsisaccurate?patentisimpairedunder:A.IFRSB.bothIFRSandC.USGAAP54.OneofthenotabledifferencesbetweenIFRSandUSGAAPwhendealingwithincometaxisbestillustratedbyfundamentaltreatmentof:A.therevaluationofplantandequipment.B.non-deductiblegoodwill.C.temporarydifferencesbetweenthecarryingamountandtaxbaseofassetsandliabilities.55.Thefollowinginformationisavailableconcerninganewshowroomacompanybuilt.Constructionstartedon1January2012andthegrandopeningwason1January2014:19/41level1-Mock-114Loan:Fundsborrowedon1January2012andputuse€30millionimmediatelyInterestrateonloan8%,payableannuallyRepaymentforloanBalloonpayment,dueonJanuary20171constructioncostsincurredduring2012and2013ExpectedusefullifeoftheshowroomExpectedresidualvalueoftheshowroomDepreciationmethod€38.5million40years€5millionStraightlineThedepreciationexpensemillions)fortheshowroomin2014isclosestto:A.€1.0175.B.€0.8375.C.€0.9575.56.Thefollowingdataareavailableonacompany:MetricCurrent(¥millions)CashInventory462Marketablesecuritiesfairvalue)plant,andequipment(net)Receivables23677231Currentliabilities390LiquidityratiosinprioryearCashratio0.372.190.97CurrentratioQuickratio20/41level1-Mock-114Thevalueofthecompany'sliquidityratiothatdecreasedtheinthecurrentcomparedwiththeprioristhe:A.cashratio.B.quickratio.C.currentratio.57.(£millions)20146,6209220134,84056Accountsreceivable,grossAllowancefordoubtfulaccountsduringtheyear8442Basedonthepresentedinformationaboutacompany'stradereceivables,thebaddebtexpense£millions)for2014isclosestto:A.84.B.120.C.36.58.Acompanyispurchasingacustomerlistthatexpectswillprovideeconomicbenefitsforthenext5years.Thecompanychoosesuseanacceleratedamortisationmethod.choicewilllikelyresultinanamortisationexpensethatwillbethe:A.sameinallfiveyears.B.highestthefifthC.highestthefirst59.Thefollowingdataareavailableonacompany:MetricCompany$60.75$193.0$87.6StockpricepershareComprehensiveincome(millions)Othercomprehensiveincome(millions)21/41level1-Mock-114Commonsharesoutstanding(millions)46.5Onanetincomebasis,thecompany'sP/Eisclosestto:A.26.8.B.14.6.C.10.1.60.Comparedwiththemanagementdiscussionandanalysis(MD&A),notestothefinancialstatementsaretheappropriatesourcefor:A.acomprehensivedescriptionofalloftheentity'saccountingpolicychoices.B.informationcapitalexpendituresandtheysupporttheentity'sstrategicdirection.C.aspectsofaccountingpolicychoicesimportantunderstandingthefinancialstatements.61.Whichofthefollowingismostlikelyabenefitofthedirectmethodforreportingcashflowfromoperatingactivities?Comparedwiththeindirectmethod,thedirectmethod:A.providesinsightondifferencesbetweennetincomeandoperatingcashflows.B.mirrorstheforecastingapproachnormallyusedbyanalysts.C.providesdetailsonthespecificsourcesofoperatingreceiptsandpayments.62.Ane-commercecompanysellshotelroomnightsonwebsiteunderagreementfromanumberofmajorhotelchains.hotelchainsgrantthecompanyflexibilityfortheroomstheysupplythecompany'swebsiteandforthepricescharged.Thesemajorchainsbeartheresponsibilityforprovidingallservicesonceacustomerbooksaroomfromthewebsite.Duringthecurrentthecompanyreceived$5millioninpaymentsfromthesaleofhotelrooms.Thecostoftheseroomswas$4.5million,whichdoesnotinclude$250,000indirectsellingcosts.UnderUSthee-commercecompany'scostofsalesisclosestto:A.$4,750,000.B.$4,500,000.C.$250,000.22/41level1-Mock-11463.Assumeacompanyhasthefollowingportfolioofmarketablesecurities,whichwereacquiredattheendoflastyear:CategoryOriginalCost(in€)attheEndofLast12,000,000FairMarket(in€)attheEndofCurrent12,500,000Heldfortradingforsale17,000,00016,000,000IfthecompanyreportsunderIFRScomparedwithUSitsnetincomeinthecurrentyearwilllikelybe:A.€500,000B.€500,000C.the64.Whichofthefollowingisleastlikelytobeacceptableapproachforaccountingstandardsettingbodiestousewhendevelopingaccountingstandards?A.Objectives-orientedB.Rules-basedC.Revenue/expense-based65.Thefollowingdataareavailableforafirstyearofoperations:Metric£Thousands2,640EarningsbeforetaxreportedontheincomestatementDepreciationexpenseincludedinearningsbeforetaxAccountingexpensesthatarenotdeductibletaxpurposesDepreciationexpensedeductiblefortaxpurposesinfirstyearofoperationsCorporatetaxrate4,5002,1306,34025%Theend-of-yearbalancesheetwilllikelyincludethousands)adeferredtaxA.assetof£73.B.liabilityof£733.C.liabilityof£460.23/41level1-Mock-11466.Operatingsegmentsarelikelyreportableiftheyconstitute10%orofthetotalforalloperatingsegmentsofwhichfinancialmetrics?A.Assets,profit/loss,orrevenueB.Amortizationexpense,assets,orrevenueC.Capitalexpenditures,liabilities,orprofit/loss67.Acompanyhasrecentlyrevaluedoneofitsdepreciablepropertiesandestimatesthatitsremainingusefullifewillbeanother20years.Theapplicabletaxrateforallyearsis30%,andtherevaluationofthepropertyisnotrecognizedfortaxpurposes.Detailsrelatedtothisassetareprovidedthefollowingtable:(millions)AccountingPurposesPurposesOriginalandEstimatesAcquisitioncost£8,00020years£1,200£6,800£8,0008years£3,000£5,000Depreciation,straightlineAccumulateddepreciation,endof2013Netbalance,endof2013Re-estimatedandEstimates,Startof2014Revaluationbalance,startof2014Newestimatedlife£10,00020yearsNotapplicableThedeferredtaxliabilityrelatedthisasset(inmillions)asattheendof2014isclosestto:A.£690.B.£1,650.C.£960.68.Dataforafirmarepresentedthefollowingtable:24/41level1-Mock-114Asof31DecemberCash£thousands200AccountsreceivableInventory3501,250300Accountspayablepayable200Installmentloanpayable,dueinthreeequalannualpaymentson30June.600Thecurrentratioforthefirm'sindustryis3.2.Basedonthecurrentratio,thefirm'sliquiditycomparedwiththeindustryisbestdescribedasbeing:A.B.equivalent.C.25/41level1-Mock-114Questions69~76finance69.Theperunitcontributionforaproductis$12.Assumingfixedcostsof$12,000,interestcostsof$3,000,andtaxesof$2,000,theoperatingbreakevenpoint(inunits)isclosestto:A.1,417.B.1,000.C.1,250.70.ThefollowinginformationavailableforaSalespriceperunitcostperunitFixedoperatingcostsFixedfinancialcosts€85€65€50million€30millionThefirm'sbreakevenquantityofsales(inmillionunits)isclosestto:A.4.0.B.2.5.C.1.0.71.Theannualcostoftradecreditassuminga365-dayyearforterms3/10netisclosestto:A.44.9%.B.43.3%C.32.0%72.Aninventorysystemthatreducesaverageinventorywithoutsaleswillmostlikelyreducethe:A.cashconversioncycle.B.inventoryC.quickratio.73.Acompanyhasdecidedtoswitchusingaccelerateddepreciationfromstraight-line26/41level1-Mock-114depreciation.Holdingotherfactorsconstant,thedegreeoftotalleverage(DTL)willlikely:A.decrease.B.notchange.C.increase.74.AfirmisuncertainaboutboththenumberofunitsthemarketwilldemandandthepriceitwillreceiveforThistyperiskisbestdescribedas:A.businessrisk.B.operatingrisk.C.salesrisk.75.IncomeStatementMillions($)Revenues1.01.4operatingcostsFixedoperatingcostsOperatingincomeInterestincomeNetincomeThedegreeoffinancialleverage(DFL)isclosestA.2.6.B.1.7.C.1.5.76.Asharerepurchasemethodthatrequiresexistingshareholderstoindicatethenumberofsharestheywilltenderoverarangeofpricesislikelyanexampleofa:27/41level1-Mock-114A.Dutchauction.B.purchaseofsharesontheopenmarket.C.repurchasebydirectnegotiation.28/41level1-Mock-114Questions77~88RelateEquityinvestment77.Companiespursuingcostleadershipwillmostlikely:A.investinproductivity-improvingcapitalequipment.B.establishstrongmarketresearchtomatchcustomerneedswithproductdevelopment.C.engagedefensivepricingwhenthecompetitiveenvironmentisoneofhigh78.Thefollowinginformationavailableaboutacompany:Nextsalesrevenue$180million15%NextnetprofitDividendpayoutratio60%Dividendgrowthrateexpectedduring2and3Dividendgrowthrateexpectedafter3Investors'requiredrateofreturnNumberofoutstandingshares25%5%12%8.1millionThecurrentvaluepershareofthecommonstockaccordingtothetwo-stagedividenddiscountmodelisclosestto:A.$52.86.B.$39.36.C.$49.20.79.Acompanyhasinitiatedtheprocessofsellingunproductiveland,representing5%ofitstotalassets,andusingtheproceedsbuybackitscommonshares.Holdingotherfactorsconstant,theseactionsbythecompanywilllikelyresultina:A.lowersustainablegrowth.B.higherreturnonC.higheroperating80.ThefinancialsystemsthatareoperationallyefficientarelikelycharacterizedA.securitypricesthatreflectfundamentalvalues.B.liquidmarketswithlowcommissionsandorderpriceimpacts.29/41level1-Mock-114C.theuseofresourceswheretheyarevaluable.81.Whichofthefollowingstatementsisaccurate?A.Investorsowningasmallnumberofcommonshareswouldpreferstatutoryvotingtocumulativevoting.B.Convertiblepreferencesharesarevolatileandriskierthantheunderlyingcommonshares.C.Putablecommonsharesprovidebenefitsboththeissuingcompanyandinvestors.82.Whichofthefollowingstatementsisaccurateinanefficientmarket?A.Securitiesmarketpricesrespondovertochangeseconomicinformation.B.Securitiesmarketpricesfullyreflecttheirfundamentalvalues.C.Activestrategieswillleadexcessriskadjustedportfolioreturns.83.Forportfoliomanagersofactivefunds,marketindicesareleastusefulas:A.benchmarks.B.proxiestomeasurerisk-adjustedperformance.C.modelportfolios.84.Comparedwithunregulatedmarkets,regulatedmarketsarebestcharacterizedby:A.reducedarbitrageopportunities.B.highertransactioncosts.C.lowertradingvolumes.85.Thetypeofvotinginboardelectionsthatisbeneficialtoshareholderswithanumberofsharesisbestdescribedas:A.cumulativevoting.B.statutoryvoting.C.votingby30/41level1-Mock-11486.Ifsecuritiesmarketsaresemi-strong-formefficient,theappropriateroleofaportfoliomanageristo:A.investbyanalyzingpubliclyavailableinformationconsistentlygenerateabnormalreturns.B.manageportfolioswithappropriatediversificationandassetallocation,takingintoconsiderationinvestorpreferences.C.exploitappropriatetradingrulesandserialcorrelationsachievingexcessreturns.87.Acompanyhasissuedonlyoneclassofshares,anditdoesnotpaydividendsonthem.Ithasalsoissuedtwotypesofnon-cumulativepreferenceshares:onethatisputableandtheothercallable.Whichofthesesecuritieswilllikelythelowestexpectedreturntotheinvestor?A.CommonsharesB.CallablepreferencesharesC.Putablepreferenceshares88.Firmswithwhichofthefollowingcharacteristicsarelikelycandidatesforamanagementbuyout(MBO)?A.FirmswithamountsofundervaluedassetsB.FirmswithlevelsofcashflowC.Firmswithhighdividendpayoutratios31/41level1-Mock-114Questions89~94RelateDerivatives89.Thepricingofforwardsandfutureswillmostlikelyif:A.futurespricesandinterestratesarenegativelycorrelated.B.futurespricesandinterestratesareuncorrelated.C.interestratesexhibitzero90.Forastockthatpaysnodividends,thevalueofanAmericancalloptionislikely:A.theasthevalueofaEuropeancalloptionwithotherwiseidenticalfeatures.B.greaterthanthevalueofaEuropeancalloptionwithotherwiseidenticalfeatures.C.lessthanvalueofaEuropeancalloptionwithotherwiseidenticalfeatures.91.Acorporationissuesfive-yearfixed-ratebonds.ItstreasurerexpectsinterestratesdeclineforallmaturitiesforatleastthenextSheentersintoaone-yearagreementwithabankreceivequarterlyfixed-ratepaymentsandpaymentsbasedonfloatingratesbenchmarkedonthree-monthLIBOR.Thisagreementisbestdescribedasa:A.forwardcontract.B.swap.C.futurescontract.92.Whichofthefollowingstatementsisleastaccurateconcerningdifferencesthepricingofforwardsandfutures?A.Differencesthepatternofcashofforwardsandfuturescanexplainpricingdifferences.B.Pricingdifferencescanariseiffuturespricesandinterestratesuncorrelated.C.Interestratevolatilitycanexplainpricingdifferences.93.WhichofthefollowingisleastlikelyoneofthemainbenefitsofderivativeDerivativemarkets:A.revealpricesandvolatilityoftheunderlyingassets.B.enablecompaniestoeasilypracticeriskmanagement.32/41level1-Mock-114C.exhibitlowervolatilitycomparedwiththespotmarket.94.Whichstatementbestdescribestheearlyexerciseofnon-dividendpayingAmericanoptions?Earlyexercisebeadvantageousfor:A.deep-in-the-moneycalls.B.bothdeep-in-the-moneycallsanddeep-in-the-moneyputs.C.deep-in-the-moneyputs.33/41level1-Mock-114Questions95~106RelateFixed-incomeAnalysis95.AcreditanalystobservesthefollowinginformationforAlphaCo.atfiscalyearsending20X1and20X2.ExcerptfromtheConsolidatedIncomeStatementofAlphaCo.forthefiscalyearsending31December20X1and20X2(inmillions)20X1$550.0450.0100.030.020X2$505.0370.0135.038.0GrossprofitOperatingexpensesOperatingprofitInterestexpenseIncomebeforetaxesIncometaxes(at30%)Netincome70.0100.030.021.049.070.0AdditionalinformationDepreciationandamortization25.035.0Basedthisinformation,overthisperiodAlpha'sinterestcoverageratiohas:A.