CFA Level1 QuestionSet

1、Exam Weightings and my color codesSections on FinalQuestionsTopicPercentMinutes1 to 18Ethical and Professional Standards15%2719 to 32Quantitative Methods12%2133 to 44Economic Analysis10%1845 to 80FSA & Corporate Finance28%5181 to 114Asset Valuation30%54115 to 120Portfolio Management5%9Sections o

2、n your resultsEthical and Professional Standards (total) 15%Quantitative Methods 12%Economics 10%Financial Reporting and Analysis 20%Corporate Finance 8%Equity Investments 10%Fixed Income 12%Derivatives 5%Alternative Investments 3%Portfolio Management 5%Question Topic1Quantifying Cash Flows2Weighted

3、 Average Shares Issued3Retained Earnings4Valuing Inventory5Cost of Equity6WACC7NPV & IRR8NPV & IRR9Bond Equivalent Yield10WACC11Required Rate of ReturnExam Weightings and my color codes12Pure Play Method13Operating Cycle14Trade Credit15Stock Market Types16Margin Calls17ROI18Abnormal Return19

4、HHI20Dividend Growth Rate21Stock Valuation22PE Ratio23Bond Duration24Tax Equivalent Bond Yield25Bond Valuation26Bond Valuation Zero Coupon 27T-Bill Yield28Bond Dirty Price29Spot Rate Curve30Portfolio Duration31Free Cash Flow32Accounting for Bonds33Diluted Earnings Per Share34Percentage of Completion

5、35Comprehensive Income36Accounting for Lease Expenses37Expected Return38Expected Return and STD39Over/Under Valued40After Tax Cash Flow41Continuously Compounded Return42Standard Error of Sample Mean43EPS44Lease Expenses45Operating LeverageExam Weightings and my color codes46Bond Yield47Bond Yield48F

6、RA49STD Portfolio50Correlation of Returns51HHI52EPS53Profitability Index54Stock Valuation55Stock Valuation56Yield to Worst57BPS Shift58Gold Futures59Exotic Options60Beta61Net Cash Provided By62Degrees of Freedom63Inventory Turnover64Comprehensive Income65Sustainable Growth Rate66Market Value of Inde

7、x67Bond Valuation68Deferred Tax Liability69ROE70Market Weighted Index71P/E Estimate72Valuing Calls73Signifigance Level74Accounting for Inventory75Margin Return76Portfolio STD77Equity Risk Premium78FRA79EPS Compound Annual RateExam Weightings and my color codes80Weighted Average Shares Issued81WACC82

8、Stock Valuation83Bond Valuation with Forward Rates84Currency Swap85Beta86T-Bill Effective Annual Yield87Probability88Covariance Matrix89FSA90FSA91Weighted Average Shares Issued92After Tax Cost of Debt93Income Tax Expense94Average Investment in Receivables95Estimated Inventory Days96Implied P/E Ratio

9、97Market Value of Index98Future Forward Rate99Swaps100Cash FlowsQuestions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyQuestionNumberSourceQuestion 1BSAS 2007MorningUse the following information to answer questions 52to 53(in millions of US dollars)Cash collections on r

10、eceivables1300Cash dividends on common stock paid35Cash dividends on preferred stock paid120Cash purchases of inventories750Cash receipts of dividends12Depreciation expense92Interest payments35Payments of expenses300Proceeds from issurance of commonstock650Proceeds from bridge financing700Proceeds f

11、rom sale of equipment200Repurchasing of issued shares300Purchase of land600Purchase of trading securities1752The net cash provided by operatingactivites is closest to:A$210,000,000B$198,000,000C$222,000,000D$270,000,00053The net cash provided by financingactivities is closest to:A$750,000,000B$800,0

12、00,000C$850,000,000D$900,000,0002BSAS 2007MorningTime-Warner had the following information related toits common stock for the year.541-Jan Number of shares outstanding100,0001-Mar Number of shares issued1500030-Jun 3.5% cash dividend declared1-Jul Number of shares reacquired120001-Oct Two-for-one st

13、ock splitWeighted average shares outstandingfor the year is closest to:A212,000B213,000C225,000D150,0003BSAS 2007MorningThe following information wasabstracted from the records of theVancouver Corp:Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracy48Total income si

14、nce incorporation$1,200,000Total cash dividends paid240,000Total par value of 20% stockdividends ditributed (market value of$125,000)75,000Excess of proceeds over par value ofstock issued125,000The current balance of retainedearnings is closest to:A$775,000B$815,000C$835,000D$855,0004BSAS 2007Mornin

15、gThe Yukon Corporation incurred thefollowing transactions for February,2007. Yukon is unsure of whether touse LIFO, FIFO or the average costmethod. The inventory method thatshows the highest profits among thealternatives would show endinginventory closest to:62Unit CostFeb. 1stUnits on Hand 400$7.00

16、Feb. 8Received 800 units, total on hand 1200$7.30Feb. 17Units Sold 500, On Hand 700Feb. 25Received 200 units, On Hand 900$7.70Feb. 28Units Sold 400, On Hand 500A$3,700B$3,600C$3,500D$10,1805CFAIChapter 45Using the following information whatis the approximate cost of equitycapital for Sears Mining if

17、 thecompany pays a dividend of $2.15next year, has retention rate of 73percent, a ROE of 13.5 percent and astock price of $47?3A4.50%B6.17%C7.96%D9.18%6CFAIChapter 45John Smith, CFA has been assignedthe task by his employer SmothersBrothers Brokerage to determine theweighted cost of capital of Zulu

18、Corp.He has been provided the followinginformation:7Before-tax cost of new debt8.50%Corporate Tax Rate37%3Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyTarget debt-to-equity ratio0.8Current Stock Price$32Next years dividend$1.75Estimated growth rate6.73%Estimat

19、ed Beta1.3WACC is closest to:A5.6%B6.1%C6.5%D7.5%7CFAIChapter 44Given the following cash flowscalculate the NPV and IRR allowingfor a required rate of return of 10%.1YearCash Flow0-$80,000.001$17,000.002$17,000.003$50,000.004$25,000.005-$5,000.00NPVIRRA$1,040.6010.55%B$7,249.8113.54%C$4,979.9410.55%

20、D-$7,855.334.34%8CFAIChapter 44Projects 1 and 2 have similar costsbut differing patterns of future cashflows. Given the cash flows as wellas the NPV and IRR and a requiredrate of return of 10 percent which ofthe two mutually exclusive projectsshould you invest in?12YearProject 1 Project 20-100-10014

21、0024003400440200NPV$24.36$33.28IRR22%19%AInvest in Project 1 because it has thelarger IRRBInvest in Project 2 because it has thelarger NPVCInvest in Project 1 because it has theshorter payback periodDInvest in Project 1 because it has thesmooth yearly cash flows6Questions cooked up by Muskie McKay f

22、rom various sourcesNo guarantee of 100% accuracy9CFAIChapter 46Calculate the bond equivalent yieldfor a 185-day U.S. Treasury bill thathas price of $9650 and a face valueof $10000.4A6.47%B6.91%C7.16%D7.06%102007 BFSAfternoonNBCs capital structure includes $20million in debt and $10 million inequity.

23、 Their bonds currently have ayield-to-maturity of 6.5 percent.The firms Beta has been estimatedat 1.25. The risk free rate iscurrently 5 percent and NBC mustpay a risk premium of 8 percent. Iftheir corporate tax rate is 37percent, the firms weighted averagecost of capital is closest to:75A7.02%B7.65

24、%C9.71%D11.25%112007 BFSAfternoonVision Critical concluded a marketresearch study on a five-yearproject. The projects expected netpresent value is $75,000, itsequivalent annual cost is $22,000 anddepreciation is $4500 per year. Ifthe firm pays taxes at 35 percentthen its required rate of return iscl

25、osest to:79A5.36%B9.67%C14.29%D22.55%12CFAIChapter 45An analyst gathered the followinginformation about a private companyand its publicly-traded competitor:26Private CompanyPublicCompanyTax Rate32.00%37.00%Debt/Equity0.950.85Equity BetaN.A.1.6Using the pure-play method, theestimated equity beta for

26、the privatecompany is closest to:A1.5B1.7C1.85Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyD1.9513CFAIChapter 46Given the following financialstatement data, calculate theoperating cycle for Harley Davidson.2In MillionsCredit Sales$32,000Cost of goods sold$26,0

27、00Accounts receivable$3,000Inventory - Beginning balance$2,000Inventory - Ending balance$2,500Accounts payable$1,650The operating cycle for this companyis closest to:A70B72C74D7614CFAIChapter 46Suppose a company uses trade creditwith the terms 3/15, net 45. If thecompany pays its account on the45th

28、day, the effective borrowingcost of skipping the discount on day15 is closest to:6A40%B42%C44%D46%15MusksMemoryBanksJimmy James, CFA, has been hired bythe government of Kerblackistan toadvise them in setting up their firststock market. He recommends amarket where a few licenseesdetermine the bid and

29、 ask spread andan index made up of the 45 largestcompanies in Kerblackistan. Theindex will reflect the importancethese large companies have on theKerblackistani economy. They will bethe companies with the most sharesissued.Is Jimmy James Recommending:Type of MarketType ofIndexACall Market Unweighted

30、BContinuous Dealer Market Price WeightedCContinuous Dealer MarketValue WeightedDContinuous Auction MarketValue Weighted12Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracy16BFASMorningSessionSarah Sutherland, an investor,purchases on margin 10,000 share ofBeta Corp

31、. for 25 dollars a share. Herbroker said there would be zerocommision on such a large purchase,however the margin requirement forthe purchase would be 50%, themaintenance margin would be 35%and the call money rate is 4.5%.One year later shares of Beta Corp.are trading at 19.50 per share.Which of the

32、 following is mostaccurate?82Initialmarginamount ($) Total Return on Investment (%)Receivedmargin call?A$125,000-48.50% NoB$125,000-44% YesC$250,000-24% YesD$250,000-22% No17BFASMorningSession90Jill purchased a stock for $35 lastyear and it currently trades at $40.During her investment horizon, sher

33、eceived $1.50 in dividends. If thestocks Beta is 1.25, her return duringthe year is closest to:A16 percentB17 percentC18 percentD19 percent18Schweiser =Reading 54Jill Smith CFA has gathered thefollowing data about a stock:10Estimated Beta1.37Actual Return10.90%Market Rate of Return6%Risk Free Rate3.

34、50%Compute the stocks abnormal rate of return.A3.55%B3.975%C4.25%D4.375%19CFAI 58An analyst gathered the followinginformation about market shares intwo industries:3Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyMarket Share in Industry 1MarketShare inIndustry 2T

35、he top firm has 42%The top threefirms all have21%The next two each have 9%The next twohave 8% eachThe other eight all have 5%The last threehave 7%each.Which industry has the highest:four frim concentration rationHefindahlIndexA11B12C21D2220BFAS Morning87A company released its latestfinancial stateme

36、nts:Net Income$2,500,000Dividends declared$850,000Total Equity$6,500,000Total Debt$4,500,000Total Assets$14,000,000The companys dividend growth rateis closest to:A24%B25%C26%D27%21BFAS Morning89Yakamichi Corp. paid $1.75 annualdividend last year and distributed 67percent of its earnings toshareholde

37、rs. The firms projectedROE is 12.5 percent. If investorsrequire 14 percent rate of return onthis stock, the estimated value ofYakamichis stock is closest to:A$17.00B$17.75C$18.50D$19.2522BFASAfternoon19Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracy87The market

38、equilibrium rate on thestock of Williams Brothers is 8.5%.Its expected return on equity is12.5% and its expected earnings pershare is $4.50. If the firms plowbackratio is 37.5%, its price to earningsratio will be closest to:A15.9B16.4C16.8D17.223CFAI 63Jimmy James, CFA has been taskedwith estimating

39、 the interest rate riskof a bond using duration. Thecurrent price is 83. An internalcomputer valuation model haspredicted that if interest ratesdecline by 25 basis points, the pricewill increase to 85 and if interestrates increase by 25 basis points theprice will decline to 81. 5The duration of this

40、 bond is closest to?A10B11C12D1324CFAI 6518Arnold Palmer is a taxable investorwho is currently in the 30% incometax bracket. He is considering thepurchase of a tax-exempt bondissued by Palm Beach MunicipalAuthority with a yield of 4%. The taxequivalent yield of this bond isclosest to:A5.25%B5.75%C6.

41、25%D6.75%25CFAI 677What is the value of a 4 year 7%coupon bond selling at a yield of 6%assuming the coupon payments aremade semiannually?A$100.00B$102.25C$103.50D$104.7526CFAI 678What is the value of a zero-couponbond paying semiannually thatmatures in 15 years, has a maturityof 2.5 million and is s

42、elling at a yieldof 6.75%?22Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyA$777,349.23B$876,000.00C$900,000.00D$923,579.6027CFAI 6715A Treasury Bill with 72 days fromsettlement to maturity is selling for$0.997 per $1 of maturity value.What is the yield on a dis

43、count basis?A1.37%B1.50%C1.69%D1.77%28CFAI 67For a bond trading on the KoreanStock Exchange, using the actualdays/actual days conventioncalculate its dirty price.19The bond has a coupon rate of 6%Pays Coupons SemiannuallyIs quoted at 102 and 13/32ndspercent of parThe Par Value is $10,000Settlement t

44、akes place on April 8th.The next coupon will be paid on July15th, which is 98 days aftersettlement.There are 181 days between January15 and July 15.The Dirty Price is Closest to:A$10,000.00B$10,240.62C$10,378.19D$10,403.0629CFAI 6834Use the following spot rate curve tocalculate the implied forward r

45、ate fora six-month loan beginning 18 monthsfrom now.MaturitySpot RateSix months5.00%Twelve months6.00%Eighteen months7.00%Twenty-four months8.00%Thirty months9.00%Thirty-six months10.00%A10.56%B10.78%C11.22%D11.64%30CFAI 6922An investor holds three bonds in their portfolio.BondMarket ValueDuration26

46、Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracy6.2% 3 year$300,0002.57.3% 4 year$200,0002.757.1% 5 year$500,0008.02The portfolio duration is:A5.31B4.42C4.21D4.1131Schweiser 2008 Exam 3 Afternoon Session50An analyst gathered the followinginformation about a compa

47、ny:Cash flow from operations$700Purchase of Plant$50Sale of Land$27Interest Expense$75Depreciation and Amortization$110The company has a tax rate of 35%and prepares its financial statementunder U.S. GAAPThe companys free cash flow to thefirm is closest to:A625B675C715D86532Schweiser 2008 Exam 3 Afte

48、rnoon Session54A company issues $5,000,000 of 5-year annual, 7% coupon bonds.Upon issurance their YTM was 6.5%.Based on this information, the initialbalance sheet valuation and the firstyears income statement amortizationare:Initial BalanceAmortizationA$5,000,000.00$0.00B$5,350,000.00$22,750.00C$5,1

49、03,891.99$18,247.02D$5,325,000.00$27,083.3333Schweiser 2008 Exam 3 Afternoon Session55An analyst gathered the followingdata about a company:1,500,000 shares of common stockare outstanding at the beginning ofthe year.10,000 6% convertible bonds(conversion ratio 20 to 1) wereissued at par June 30 of t

50、his year.The company has 250,000 warrantsoutstanding all year with an exerciseprice of $25 per share.30Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyThe average stock price for theperiod is $20, and the ending stockprice was $30.If the convertible bonds arecons

51、idered dilutive, the number ofshares of common stock that theanalyst should use to calculatediluted earnings per share is:A1,500,000B1,600,000C1,700,000D1,750,00034Schweiser 2008 Exam 3 Afternoon Session59A research analyst has collected thefollowing information regarding a long-term construction pr

52、oject. Thecompany uses the percentage-of-completion methodology to accountfor this project:InvoicedAmountsA/R CollectionsConstructionExpenses2004$1,000$800$7002005$500$600$5002006$500$600$400Total$2,000$2,000$1,600Given this information, the netconstuction-in-progress balancesheet value at the end o

53、f 2005equals:A0B400C500D60035Schweiser 2008 Exam 3 Afternoon Session64At the end of its last fiscal year,Vintners Supply Corp. reportedretained earnings of $200,000. Thisyear, Vintners reported year-endretained earnings of $250,000 andnet income of $25,000, paid dividendsof $10,000, paid interest ex

54、pense of$5,000, and received dividends of$5,000. Vintners othercomprehensive income for this year isclosest to:A50000B2500033Questions cooked up by Muskie McKay from various sourcesNo guarantee of 100% accuracyC20000D1500036Schweiser 2008 Exam 3 Afternoon Session66A company leased an airplane under

55、the following terms:The lease is a 10-year capital leaseThe present value of the leasepayments discounted at theappropriate interest rate (10%) is$5,000,000The company uses the straight-linedepreciation method.The company does not own the assetor have a purchase option at the endof the lease.In the

56、first year, the reported leaserelated expense is:A$1,000,000.00B$500,000.00C$50,000.00D$0.0037BFAS Morning115An investor wants to achieve aportfolio risk (standard deviation) of0.037. The expected return on themarket portfolio is 0.12 with astandard deviation of 0.1. If the riskfree rate is .042, th

57、e best expectedreturn the investor can achieve isclosest to:A4.44%B7.00%C8.00%D12.00%38BFASAfternoon117Expected returns on the Fidelity S&P500 Index fund and the PrudentialLow Priced Stock fund are 8% and13.5%, respectively, and they havestandard deviations of 6.5% and14%, respectively. The corr

58、elation ofreturns between these funds is 0.75.A portfolio with 15% Prudential and85% S&P index fund would have anexpected return and standarddeviation closest to:Expected ReturnStandardDeviationA8.825%7.30%B8.825%7.65%C10.75%7.30%D10.75%7.65%35Questions cooked up by Muskie McKay from various sou

59、rcesNo guarantee of 100% accuracy39BFASAfternoon118Expected returns on Fidelity S&P 500Index fund and the Prudential LowPriced Stock fund are 8% and 13.5%,respectively, and they have betas of1.0 and 1.375, respectively. The riskfree rate is 4.5% and the expectedreturn on the market is 8%. Thereq

60、uired return on the Prudential fundis therefore _ and it is_.Expected ValueValuationA9.3 percentovervaluedB9.3 percentundervaluedC11 percentovervaluedD11 percentundervalued40CFAI 7626An investor gathered the followinginformation about a real estateinvestment:Amount financed by mortgage loan$600,000Interest rate on mortga