2008CFALevel1－MockExam3(AM)－模考试题Question1AccordingtotheCodeandStandards,membershaveadutytodisclosepossibleconflictsofinterestto:A)boththeiremployerandtheirclients.B)onlytheiremployer.C)onlytheirclients.D)neitheremployersnorclients,butthemembermustuse"prudentjudgment."Question2JohnJameshaspassedallthreelevelsoftheCFAexam,hasreceivedhischarter,andisadues-payingCFAInstitutememberingoodstanding.Jamesmayclaimthathe:isamongtheeliteofinvestmentprofessionalsbecausehebecameaCFAcharterholderinonly3years.islicensedtopracticeinvestmentanalysisbytheCFAInstitute.isaCFAcharterholder.isaCFAcharterholder,whichmeansthatheshouldbeabletoearnsuperiorreturnsrelativetoA)B)C)D)non-charterholders.Question3JoshuaRosenberg,CFA,isanequityanalystwhocoversNorthwestImplements,afarmimplementmanufacturer.Northwest'smainfactoryislocatedinasparselyinhabitedregionsixhoursbyautomobilefromthenearestairport.Northwesthasitsowncorporatejetandalandingstripislocatednearthefacility.WhenRosenbergcontactsNorthwest’smanagementtogatherinformationforareportheispreparingonthecompany,Northwest’schieffinancialofficer,ThomasBlake,invitesRosenbergtovisitNorthwest’sheadquartersandmeetwithmanagement.BlakeofferstosendNorthwest’scorporatejettopickupRosenbergfromanairportnearRosenberg’shomeandtoreturnhimhomethesameevening.Rosenbergestimatesthatitwouldrequirethreedaysforhimtomakethevisitusingcommercialtravel.IfRosenbergacceptsBlake’sofferandmakesthetriptoNorthwest’sheadquartersonthecorporatejet,Rosenberg:A)hasnotviolatedtheCodeandStandards.B)hasviolatedtheCodeandStandardsunlesshedisclosesthetripandthepaymentofhistravelexpensesinhisreportonNorthwest.C)hasviolatedtheCodeandStandardsunlesshereimbursesNorthwestforthecostofthetrip.D)hasviolatedtheCodeandStandardsifheproceedstowritethereport.Question4VijayGill,CFA,leasesofficespacefromLandBankinexchangeforanagreementthatGillwillpayLand20%ofanyfeespaidbyLandcustomerstoGillforinvestmentmanagementservices.GillalsohasanarrangementwithBloomInsuranceAdvisorswherebyGillreceivesafeeforeachclientreferred.Gillonlyrefersclientsthatrequestinsuranceproducts.GillmeetswithRandolphSingh,aLandBankcustomer,whoisinterestedinGill’sassetmanagementservicesaswellasinsuranceproducts.GillisrequiredtodisclosetoSingh:thetermsofthearrangementswithbothLandBankandBloom.A)B)neithertheLandBanknorBloomarrangements,butmaydisclosethemifhechoosestodoso.thetermsofthearrangementwithBloom,butnotthetermsofthearrangementwithLandBank.C)thetermsofthearrangementwithLandBank,butnotthearrangementwithBloom.D)Question5TheCFAInstituteStandardsofProfessionalConductareleastlikelytoinclude:A)DutiestoClientsIntegrityofCapitalMarketsB)InvestmentAnalysis,Recommendations,andActionsC)D)MaintainingandImprovingProfessionalCompetenceQuestion6WhichofthefollowingismostlikelypermittedunderStandardI(C),Misrepresentation?Includinganexhibitofthecurrentyieldcurveinareporttoaclientwithoutstatingitssource.A)B)Usingexcerptsfromreportspreparedbyotherswithoutacknowledgement.C)Citingquotesattributedto"investmentexperts"withoutspecificreference.D)Usingchartsandgraphsfromanothercompany'smarketingmaterialswithoutstatingtheirsource.Question7BillFence,CFA,supervisesagroupofresearchanalysts,noneofwhomhaveearnedtheCFAdesignationorareCFAcandidates.Onseveraloccasionshehasattemptedtogethisfirmtoadoptacompliancesystemtoensurethatapplicablelawsandregulationsarefollowed.However,thefirm'sprincipalshaveneveradoptedhisrecommendations.Fenceshouldmostappropriately:takenofurtheraction,becausetheCodeandStandardsdonotapplytoanyofhissubordinates.A)resignfromthefirm,becausenootheralternativewillkeephimincompliancewiththeCodeandStandards.B)C)declineinwritingtoacceptsupervisoryresponsibilityuntilreasonablecomplianceproceduresareadopted.D)takenofurtheraction,becausebyencouraginghisfirmtoadoptacompliancesystemhehasfulfilledhisobligationsundertheCodeandStandards.Question8CarlWeather,CFA,isthechieffinancialofficerofTalbotEnterprises.BasedoninsideinformationaboutTalbot’sfavorableprospects,WeatherconcludesthatTalbot’scommonstockpriceissubstantiallyundervaluedinthemarket.WiththeapprovalofTalbot’sBoardofDirectors,Weatherannouncesaprogramforhisfirmtorepurchase$100millionofitsownstockinthemarket.Talbot’sstockpricerisesimmediatelyaftertheannouncementoftherepurchaseprogram.ReeseWinter,aCFAInstitutemember,isWeather’sassistant.WhilewaitinginWeather’soffice,Winterreadsaninternalmemomarked“confidential”fromTalbot’schiefaccountanttoWeather.ThememostatesthatTalbotsustainedanunexpectedsubstantialprofitduringthepastquarter,anditsearningsprojectionsshowasubstantialincreasecomparedwithpreviousestimates.Winteruseshercellphonetocallherbrotheranddisclosesthisinformationtohim.Herbrotherimmediatelybuys1000sharesofTalbot’sstock.DidtheactionsofWeatherandWinterviolateStandardII(A):MaterialNonpublicInformation?WeatherWinterA)NoYesB)YesC)YesYesD)NoNoNoQuestion9GerriKocimski,CFA,isaportfoliomanagerforWendoverSecurities.KocimskireceivedcorrespondencefromAlfredTombathatincludedabriefletterrequestingthatKocimskipurchaseaportfolioofgrowthstocksonbehalfofTomba,andincludedacheckfor$1,000,000madeouttoWendover’scustodian,togetherwithcontractandapplicationthatwerecompletedandsigned,exceptthatnoneofthequestionsthataskedaboutTomba’spersonalfinancialcircumstances,networth,andinvestmentexperiencehadbeenanswered.Kocimskimostlikely:A)shouldnotopentheaccountbeforecontactingTombatoinquireaboutTomba'sfinancialsituation,investmentexperience,andinvestmentobjectives.B)musthavesigneddocumentationfromTombathatdescribeshisfinancialsituation,investmentexperience,andinvestmentobjectivesbeforeshecanopentheaccount.C)mayopentheaccountbecauseTomba'snetworthisequaltoorexceeds$1,000,000andheisaqualifiedinvestorbasedonthesizeofhisaccount.D)mayopentheaccountbecauseTombaaffirmativelysolicitedKocimski'sservices.Question10Barders,Inc.hasaportfolioofenergystocksthatisbeingmanagedbyDrewGrant,CFA,arepresentativeofBladstoneInvestments.BardershasapproachedGrantandofferedtopayhima$1,000bonusiftheBardersportfoliooutperformsitsindustryaverageby3percentagepointsormorethisyear.TobeincompliancewiththeCodeandStandards,Grantmust:informBladstoneinwritingaboutthebonusarrangement.informhissupervisorandreceiveapprovalbeforeacceptingthebonus.A)B)C)obtainwrittenconsentfrombothBardersandBladstonetoparticipateinthebonusarrangement.D)notacceptthebonusarrangementasitcreatesaconflictofinterestwithhisotherclients.Question11InorderforafirmtoclaimcomplianceundertheGlobalInvestmentPerformanceStandards(GIPS),itmustdefineitselfasafirm.WhichofthefollowingdefinitionsofafirmisleastlikelytobeacceptableunderGIPS?A)Anentityregisteredwiththeappropriatenationalregulatoryauthorityoverseeingtheentity'sinvestmentmanagementactivities.B)Aninvestmentfirm,subsidiary,ordivisionheldouttoclientsorpotentialclientsasadistinctbusinessunit.C)Aregionalbranchofaninvestmentfirmmarketedunderthenameofitsparent.D)Aninvestmentfirmthathasbeeninexistenceforlessthanfiveyears.Question12ChipLawson,CFA,isworkingonanoutsideconsultingprojectforwhichhehasnotyetbeenpaid.Lawson'ssupervisor,aCFAcharterholderaswell,findsoutandaccusesLawsonofviolatingStandardIV(A),Loyalty.Lawsondisagrees.Whichofthefollowingstatementsregardingthissituationismostaccurate?A)Lawsoniscorrect;noviolationhasoccurredbecauseStandardIV(A)statesthatinorderforaviolationtooccur,thefirmreceivingtheconsultingworkmustfileacomplaintwithLawson.B)Thesupervisoriscorrect;aviolationhasoccurredbecauseLawsoncouldeventuallybepaidfortheproject.C)ThesupervisorisincorrectbecausetheLoyaltytoEmployerStandarddoesnotaddressconsultingopportunities.D)Thesupervisorisincorrect;noviolationhasoccurredbecauseLawsonhasnotreceivedcompensation.Question13PamDevereaux,aLevelIIICFAcandidate,isaninvestmentmanagerforBelisareFunds.DevereauxdirectshertradestoTheodoraBrokerage,afirmforwhichDevereauxservesontheboardofdirectors.DevereauxhasreceivedconsentfromBelisareforherboardmembershipatTheodora,butshehasnotinformedherclientsofherrelationshipwithTheodora.Devereauxisviolating:A)StandardVI(A),DisclosureofConflicts,andStandardIV(B),AdditionalCompensationArrangements.B)StandardIII(B),FairDealing.C)StandardVI(A),DisclosureofConflicts.D)StandardIII(B),FairDealing,andStandardIV(B),AdditionalCompensationArrangements.Question14DonWilsonandNadineChavis,bothCFAcharterholders,areinvestmentadvisorsatUptownSecurities.WilsonrecommendsthatoneofhisclientsbuyAlphaCompanybasedonresearchconductedbyUptown.ChavisrecommendsthatoneofherclientssellAlphaCompanybasedonresearchconductedbyanotherbrokeragefirmforgeneraldistribution.Bothrecommendationsareconsistentwitheachclient'sinvestmentobjectivesandwithinthecontextoftheirentireportfolios.NeitherWilsonnorChavishasreasontosuspectthatanyinformationcontainedintheresearchreportsfromthesetwosourcesisinaccurateorinadequatelysupported.AccordingtoStandardV(A)DiligenceandReasonableBasis,doWilsonandChavishaveareasonablebasisformakingtheirinvestmentrecommendations?A)NeitherWilsonnorChavishasareasonablebasisfortheirrecommendations.B)BothWilsonandChavishaveareasonablebasisfortheirrecommendations.C)Wilsonhasareasonablebasisforhisrecommendation,butChavisdoesnot.D)Chavishasareasonablebasisforhisrecommendation,butWilsondoesnot.Question15Amemberwhosuspectsthatacolleagueisviolatingthelawshouldmostappropriately:A)reporttheillegalactivitytoCFAInstituteProfessionalConductProgramforaction.B)reporttheillegalactivitytotheappropriateregulatoryagency.C)consultwiththecompanycounseltodetermineifinfactalawisbeingviolated.D)intervenewiththecolleagueandattempttostoporpreventtheillegalactivity.Question16StandardV(B),CommunicationwithClientsandProspectiveClients,leastlikelyrequiresmembersto:A)usereasonablejudgmentregardingtheinclusionorexclusionofrelevantfactorsinresearchreports.B)distinguishbetweenfactsandopinionsinresearchreports.C)disclosethegeneralprinciplesofinvestmentprocessesusedtoanalyzeandselectsecurities,andconstructportfolios.D)makeclearbuyorsellrecommendationsonthesecuritiescoveredinresearchreports.Question17BerthaMader,CFA,receivedproxymaterialrelatedtoahostiletakeoverattemptofDanubeIndustriesbyBalnetCompany.SheholdssharesofDanubeinmostofherclientaccounts.MaderhasahighopinionofDanube’smanagementbecausetheyhaverunthecompanysuccessfullyandhavealwaysrespondeddirectlyandhonestlytoherinquiries.SheisnotacquaintedwithBalnet’smanagementteambutknowstheyhaveareputationforimprovingthebottomlineatthecompaniestheyacquire,partlybecausetheytendtoreplaceuppermanagementattheirtargetsandassumetheirfunctions.Balnet'sofferis60%higherthanthepriceofDanubesharesbeforetheannouncement.Danube’smanagementhascontactedMaderandrequestedthatshevotethesharesshecontrolsagainstthetakeoverbecausethemanagementisconcernedfortheirjobsandforthewelfareofthecompany.TocomplywiththeCodeandStandards,Madershould:A)voteforthetakeoverifshecangetassurancethatDanube'smanagementteamwillremaininplace.B)voteagainstthetakeoverifitdoesnotappearthatthetakeoverisinthebestinterestofthecompany.C)voteforthetakeoverifitisinthebestinterestofDanube'sshareholders,regardlessoftheconsequencestocurrentmanagement.D)delegateherproxyvotetoanothermemberofherfirmduetotheconflictofinterestcreatedwhenshewascontactedbymanagement.Question18WhichofthefollowingactionsmostlikelyviolatesStandardI(D)–Misconduct?A)ALevel1candidateisejectedfromahotelforattemptingtopassabadcheck.B)Amember’smarketforecastshavebeenwronginthreeconsecutivequarters,promptingaformalcomplaintfromaclient.C)Amemberpursuesanemploymentopportunitywithacompetingfirm,primarilyasameansofsecuringasalaryincreasefromhercurrentemployer.D)ALevel2candidateinUpperMoesiaisrepeatedlyarrestedforprotestingagainstthecountry’srulers.Question19Johnisgettinga$25,000loan,withan8%annualinterestratetobepaidin48equalmonthlyinstallments.Ifthefirstpaymentisdueattheendofthefirstmonth,theprincipalandinterestvaluesforthefirstpaymentareclosestto:PrincipalInterest$443$200A)$443$166B)$200$410C)$166$410D)Question20Whichofthefollowingstatementsaboutkurtosisismostaccurate?A)Kurtosisiscriticaltoriskmanagementbecausemostriskmanagersputmoreemphasisonthestandarddeviationofadistributionthanthedistributionofreturnsinthetail.B)Mostinvestorsperceivealeptokurticdistributionasriskierthanaplatykurticdistribution.C)Adistributionthatislesspeaked(flatter)thannormalisleptokurtic.D)Forallnormaldistributions,kurtosisequals3,andexcesskurtosisiskurtosisplus3.Question21PatBinder,CFA,isexaminingtheeffectofaninvertedyieldcurveonthestockmarket.Shedeterminesthatinthepastcentury,75%ofthetimestheyieldcurvehasinverted,abearmarketinstocksbeganwithinthenext12months.Binderbelievestheprobabilityofaninvertedyieldcurveinthenextyearis20%.Binder'sestimateoftheprobabilitythattherewillbeaninvertedyieldcurveinthenextyearfollowedbyabearmarketisclosestto:A)38%.B)50%.C)75%.D)15%.Question22