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Chartered Financial Analyst Tests Bundle Set
Chartered Financial Analyst Tests Bundle Set
[Show more]Chartered Financial Analyst Tests Bundle Set
[Show more]Addition Rule of Probability CORRECT ANSWER ADDITION: P(A or B) = P(A) + P(B) - P(AB) 
 
Roy's Safety First Criterion CORRECT ANSWER Safety First Ratio = (E(R) - Rₜ) / σ 
 
Larger ratio is better 
 
If (Rₜ) is risk free rate, then it becomes Sharpe Ratio 
 
Sharpe Ratio CORRECT ANSWER Sharpe R...
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Add to cartAddition Rule of Probability CORRECT ANSWER ADDITION: P(A or B) = P(A) + P(B) - P(AB) 
 
Roy's Safety First Criterion CORRECT ANSWER Safety First Ratio = (E(R) - Rₜ) / σ 
 
Larger ratio is better 
 
If (Rₜ) is risk free rate, then it becomes Sharpe Ratio 
 
Sharpe Ratio CORRECT ANSWER Sharpe R...
faithful representation, substance over form, prudence, neutrality, completeness CORRECT ANSWER According to the IFRS what are the 5 qualities of financial information that improve reliability 
 
Costs can be reliably measured CORRECT ANSWER According to IFRS what condition must be met for revenue r...
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Add to cartfaithful representation, substance over form, prudence, neutrality, completeness CORRECT ANSWER According to the IFRS what are the 5 qualities of financial information that improve reliability 
 
Costs can be reliably measured CORRECT ANSWER According to IFRS what condition must be met for revenue r...
Current Ratio CORRECT ANSWER Current Assets divided by current liabilities 
 
Quick Ratio CORRECT ANSWER Cash plus marketable securities plus receivables divided by current liabilities 
 
Cash Ratio CORRECT ANSWER Cash plus marketable securities divided by current liabilities 
 
Defensive Interval R...
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Add to cartCurrent Ratio CORRECT ANSWER Current Assets divided by current liabilities 
 
Quick Ratio CORRECT ANSWER Cash plus marketable securities plus receivables divided by current liabilities 
 
Cash Ratio CORRECT ANSWER Cash plus marketable securities divided by current liabilities 
 
Defensive Interval R...
Default Risk CORRECT ANSWER Risk that a borrower will not make promised payments 
 
Liquidity Risk CORRECT ANSWER Risk of recieving less than fair value for an investment if it must be sold for cash quickly 
 
Required Interest Rate on A Security CORRECT ANSWER = Nominal Interest Rate 
+ Default Ris...
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Add to cartDefault Risk CORRECT ANSWER Risk that a borrower will not make promised payments 
 
Liquidity Risk CORRECT ANSWER Risk of recieving less than fair value for an investment if it must be sold for cash quickly 
 
Required Interest Rate on A Security CORRECT ANSWER = Nominal Interest Rate 
+ Default Ris...
What are the 4 types of measurement scales? CORRECT ANSWER 1. Nominal Scales 
2. Ordinal Scales (Assigned to a category) 
3. Interval Scales (Relative ranking) 
4. Ratio Scales (Equal differences between scale values) 
NOIR 
 
When do we use geometric and arithmetic means to analyze investment retur...
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Add to cartWhat are the 4 types of measurement scales? CORRECT ANSWER 1. Nominal Scales 
2. Ordinal Scales (Assigned to a category) 
3. Interval Scales (Relative ranking) 
4. Ratio Scales (Equal differences between scale values) 
NOIR 
 
When do we use geometric and arithmetic means to analyze investment retur...
Price change based on convexity CORRECT ANSWER -duration(change in yield)+1/2(convexity)(change in yield)^2 
 
Effective Duration CORRECT ANSWER Required if a bond has embedded options: [(v-)-(v+)]/[2V0(change in curve)] 
 
Modified Duration CORRECT ANSWER [(v-)-(v+)]/[2V0(change in yield)] 
 
Futur...
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Add to cartPrice change based on convexity CORRECT ANSWER -duration(change in yield)+1/2(convexity)(change in yield)^2 
 
Effective Duration CORRECT ANSWER Required if a bond has embedded options: [(v-)-(v+)]/[2V0(change in curve)] 
 
Modified Duration CORRECT ANSWER [(v-)-(v+)]/[2V0(change in yield)] 
 
Futur...
In situations where the laws of a member or candidate's country of residence, 
the local laws of regions where the member or candidate does business, and the 
Code and Standards specify different requirements, the member or candidate 
must abide by: 
A. local law or the Code and Standards, whicheve...
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Add to cartIn situations where the laws of a member or candidate's country of residence, 
the local laws of regions where the member or candidate does business, and the 
Code and Standards specify different requirements, the member or candidate 
must abide by: 
A. local law or the Code and Standards, whicheve...
FCFF (using EBITDA) CORRECT ANSWER FCFF = EBIDTA(1-T) + DEP(T) - Finv - Winv 
 
Converting FIFO to LIFO COGS CORRECT ANSWER FIFO COGS = LIFO COGS - (End LIFO Reserve - Beg LIFO reserve) 
 
Engle- Granger Test CORRECT ANSWER Test whether 2 variables are cointegrated. Regress 1 data series against the...
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Add to cartFCFF (using EBITDA) CORRECT ANSWER FCFF = EBIDTA(1-T) + DEP(T) - Finv - Winv 
 
Converting FIFO to LIFO COGS CORRECT ANSWER FIFO COGS = LIFO COGS - (End LIFO Reserve - Beg LIFO reserve) 
 
Engle- Granger Test CORRECT ANSWER Test whether 2 variables are cointegrated. Regress 1 data series against the...
What is a covenant that forces the issuer to take action called? What is a covenant that prevents issuer from doing something called? CORRECT ANSWER Affirmative covenant. 
 
Negative covenant. 
 
What is the current yield of a bond? CORRECT ANSWER (annual cash coupon payment) / (current bond price) ...
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Add to cartWhat is a covenant that forces the issuer to take action called? What is a covenant that prevents issuer from doing something called? CORRECT ANSWER Affirmative covenant. 
 
Negative covenant. 
 
What is the current yield of a bond? CORRECT ANSWER (annual cash coupon payment) / (current bond price) ...
Types of scales in order of least to most precision. CORRECT ANSWER NOIR - Nominal, Ordinal, Interval, Ratio 
 
Parameter CORRECT ANSWER A measure used to describe a characteristic of a population. 
 
Frequency distribution CORRECT ANSWER Tabular presentation of statistical data. fancy way of saying...
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Add to cartTypes of scales in order of least to most precision. CORRECT ANSWER NOIR - Nominal, Ordinal, Interval, Ratio 
 
Parameter CORRECT ANSWER A measure used to describe a characteristic of a population. 
 
Frequency distribution CORRECT ANSWER Tabular presentation of statistical data. fancy way of saying...
Price Elasticity of Demand Formula CORRECT ANSWER (% Change in Quantity Demanded) / (%t Change in Price) 
 
Cross Elasticity of Demand Formula CORRECT ANSWER (% Change in Quantity Demanded) / (% Change in Price of Substitute or Complement) 
 
Income Elasticity of Demand Formula CORRECT ANSWER (% Cha...
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Add to cartPrice Elasticity of Demand Formula CORRECT ANSWER (% Change in Quantity Demanded) / (%t Change in Price) 
 
Cross Elasticity of Demand Formula CORRECT ANSWER (% Change in Quantity Demanded) / (% Change in Price of Substitute or Complement) 
 
Income Elasticity of Demand Formula CORRECT ANSWER (% Cha...
if you were fired from a previous job and fail to tell your new emmployer is that a violation and if so of what? CORRECT ANSWER yes, misconduct. this information could potentially harm your new employer and he needs to know man! 
 
degress of price discrimination CORRECT ANSWER 1st degree-- know pri...
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Add to cartif you were fired from a previous job and fail to tell your new emmployer is that a violation and if so of what? CORRECT ANSWER yes, misconduct. this information could potentially harm your new employer and he needs to know man! 
 
degress of price discrimination CORRECT ANSWER 1st degree-- know pri...
Which symptoms should be reported to a manager? CORRECT ANSWER Vomiting, diarrhea, jaundice, sore throat with fever, and all covid-19 sumptoms 
 
What are the Big Five illnesses that should be reported to a manager? CORRECT ANSWER Hepatitis A, norovirus, Salmonella, Shigella, E. Coli 
 
Causes of fo...
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Add to cartWhich symptoms should be reported to a manager? CORRECT ANSWER Vomiting, diarrhea, jaundice, sore throat with fever, and all covid-19 sumptoms 
 
What are the Big Five illnesses that should be reported to a manager? CORRECT ANSWER Hepatitis A, norovirus, Salmonella, Shigella, E. Coli 
 
Causes of fo...
Which of the following components of the cash flow statement may be prepared under the indirect method under both IFRS and U.S. GAAP? 
A. Operating. 
B. Investing. 
C. Financing. CORRECT ANSWER A. operating 
 
Which components of the CF statement MUST be prepared under direct method? 
operating,...
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Add to cartWhich of the following components of the cash flow statement may be prepared under the indirect method under both IFRS and U.S. GAAP? 
A. Operating. 
B. Investing. 
C. Financing. CORRECT ANSWER A. operating 
 
Which components of the CF statement MUST be prepared under direct method? 
operating,...
assets for immediate or future use, enable growth in saving for future, raise capital via equity issuance, trade on information, borrow money for current use, risk management 
 
- in a properly functioning financial system, transaction costs are low, participants are able to accurately estimate asse...
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Add to cartassets for immediate or future use, enable growth in saving for future, raise capital via equity issuance, trade on information, borrow money for current use, risk management 
 
- in a properly functioning financial system, transaction costs are low, participants are able to accurately estimate asse...
Bond Indenture CORRECT ANSWER Contract that specifies all the rights and obligations of the issuer and owners of a fixed income security. 
 
Negative Covenants CORRECT ANSWER Prohibitions on the borrower. 
 
Affirmative Covenants CORRECT ANSWER Actions that the borrower promises to perform. 
 
Matur...
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Add to cartBond Indenture CORRECT ANSWER Contract that specifies all the rights and obligations of the issuer and owners of a fixed income security. 
 
Negative Covenants CORRECT ANSWER Prohibitions on the borrower. 
 
Affirmative Covenants CORRECT ANSWER Actions that the borrower promises to perform. 
 
Matur...
Inventory TO CORRECT ANSWER COGs / Average Inventory 
 
DOH CORRECT ANSWER 365 / (Inventory TO) 
 
Receivables TO CORRECT ANSWER Revenue / Avg. Receivables 
 
DSO CORRECT ANSWER 365 / Receivables TO 
 
Payables TO CORRECT ANSWER Purchases / Avg. trade payables 
 
Days payables CORRECT ANSWER 365 / P...
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Add to cartInventory TO CORRECT ANSWER COGs / Average Inventory 
 
DOH CORRECT ANSWER 365 / (Inventory TO) 
 
Receivables TO CORRECT ANSWER Revenue / Avg. Receivables 
 
DSO CORRECT ANSWER 365 / Receivables TO 
 
Payables TO CORRECT ANSWER Purchases / Avg. trade payables 
 
Days payables CORRECT ANSWER 365 / P...
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