CFA Level 1 Free Practice Test

1. The early 21st century saw a few significant stresses on the stock market. The markets dipped deeper and more quickly than many were expecting might happen.

Which of the following statistical metrics most accurately describes this event?

2. Keisha is looking to avoid purchasing power risk as much as possible. She should consider investing in which type of security?

3. A bookstore earned USD200,000 over the past year. At a tax rate of 40%, that bookstore incurs an income tax expense of USD80,000. Under which of the following accounting systems would the expense typically be categorized as an operating activity?

I. IFRS
II. U.S. GAAP

4. A 10 Year semi-annual 8% coupon bond is selling at USD967. If the yields increase by 50 basis points the price is expected to fall to USD924 and if the yields decrease by 50 Basis points the price is expected to rise to $1010.

The effective duration is closest to:

5. The exchange rate between two currencies has decreased to 101.34. The price currency has appreciated by 7.5 percent against the base currency. The initial exchange between the two currencies was closest to: