ACCOUNTING CFA CFA Level I - 1 Full Length Mock
Exam actual 2024 prep exam questions and
answers complete update Concordia University
,Topics Questions Points
Ethics and Professional Standard 1-18 27
Quantitative Analysis 19-32 21
Economics 33-44 18
Financial Reporting and Analysis 45-68 36
Corporate Finance 69-78 15
Equity Investment 79-90 18
Derivatives 91-96 9
Fixed Income 97-108 18
Alternative Investment 109-114 9
Portfolio Management 115-120 9
ETHICS QUESTIONS( 1 – 18)
1. Jason Dawson, CFA is an equity portfolio manager at Star Real Advisors, a firm specializing in real
estate investments.
Dawson recently attended his first seminar on real estate investments. In the seminar, real estate
analysts discussed the bright prospects of real estate as an alternative investment & highly
recommended it considering the consistent above-average performance of real estate as an asset
class in the past 3 years.
On being excited with his new-found knowledge, Dawson immediately recommended to all his
clients an immediate allocation of 10% of their portfolio to real estate investments. After a week, he
allocated 10% of his own portfolio to real estate investments.
, Which of the standards did Jason most likely violate?
A: Standard I (B) Independence & Objectivity.
B: Standard V (A) Diligence & Reasonable Basis.
C: Standard VI (B) Priority of Transactions.
Sol. B. Standard V (A) Diligence & Reasonable Basis.
Standard V (A) requires members to exercise diligence & thoroughness in analysing investments,
making recommendations & taking investment actions. Members must have reasonable & adequate
basis, supported by appropriate research & investigation for any investment analysis,
recommendation or action.
Dawson relied solely on the views of the analysts who themselves have based their opinion only on
the performance data of the past three years. Therefore he has violated this standard.
In this case his independence & objectivity has not been impaired by any gift, benefit or other
consideration.
He has not violated the standard of priority of transactions because he changed the allocation of his
own portfolio after a reasonable period of time.
2. Emily Lynch, CFA is preparing advertising material of her sole proprietary investment
management concern.
The material states: “I am a CFA & have cleared all the three examinations in first attempt.”
Lynch has:
A. Violated the Standard VII (B) Reference to CFA Institute, CFA Designation & the CFA Program
by improperly referencing the CFA mark & by exaggerating her examination performance.
B. Violated the Standard VII (B) Reference to CFA Institute, CFA Designation & the CFA
Program by improperly referencing the CFA mark but not by mentioning her examination
performance.
C. Has not violated the Standard VII (B) Reference to CFA Institute, CFA Designation & the CFA
Program.
Sol. B. violated the Standard VII (B) Reference to CFA Institute, CFA Designation & the CFA Program by
improperly referencing the CFA mark but not by mentioning her examination performance.
The CFA mark must always be used either after a charter holder’s name or as adjective, but not as a
noun n written or oral communication.
Lynch may state that she has cleared all the examinations in first attempt as long as it is true & is
not linked to superior performance & ability.
, 3. The CFA Institute Professional Conduct Program (PCP) is investigating some investment actions of
Edwin Schneider, CFA. These actions were suspected to be unsuitable for a few clients. PCP
requires Edwin to provide data of his clients he considered suitable for an exotic derivative which
was deemed to be very risky & speculative.
Edwin will:
A. Violate the Code & Standards if he discloses the names of the clients & their investments.
B. Not violate the Code & Standards if he discloses only their investments but not their names.
C. Will not violate the Code & Standards if he discloses the names of the clients &
their investments.
Sol. C.will not violate the Code & Standards if he discloses the names of the clients & their
investments.
An exception to the Standard governing the preservation of client’s confidentiality is a PCP
investigation. Members are expected to full co-operate with PCP’s investigations because PCP will
keep the clients’ information confidential.
4. Global Investment Performance Standards (GIPS) require a minimum of:
A: 3 years of historical performance.
B: 5 years of historical performance.
C: 10 years of historical performance.
Sol. B. 5 years of historical performance.
5. The supplemental provisions within the GIPS must be applied to which of the following asset classes?
A: Real Estate & Private Equity.
B: Real Estate & Commodities.
C: Commodities & Private Equity.
Sol. A. Real Estate & Private Equity.
Sections 6 & 7 are supplemental provisions within GIPS which must be specifically applied to real
estate & private equity respectively.
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