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Thread: FREE CFA Level 1 sample questions everyday for December 2010 candidates

  1. #301
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    Quote Originally Posted by vbadmin View Post
    Q#73 Answer: (A)

    Professional money managers, as a group, have not been found to outperform the market.

    ================================================== =====================================
    Today's question (Questions and answers are provided by Austal Group)

    Q#74. Assuming that a company's return on equity (ROE) is 12% and the required rate of return is 10%, which of the following would most likely cause the company's P/E ratio to rise?

    A. The inflation rate falls
    B. The firm's ROE falls
    C. The firm's dividend payout rises

    ================================================== =====================================
    is it (A) decrease in inflation ?

  2. #302
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    Quote Originally Posted by nehakumaria View Post
    is it (A) decrease in inflation ?
    neha,

    Even I think it is A.

  3. #303
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    Q # 74
    Answer is A

  4. #304
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    Quote Originally Posted by Takalani View Post
    Q # 74
    Answer is A
    Hey Takalani,

    Welcome back!
    You have been missing from the forum for some time.

    Naveen

  5. #305
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    Q#74 Answer: (A)

    ================================================== =====================================
    Today's question (Questions and answers are provided by Austal Group)

    Q#75. If the Federal Reserve wishes to lower market interest rates without changing the discount rate, it can

    A. Raise the yield on Treasury securities
    B. Increase bank reserve requirements
    C. Buy Treasury securities

    ================================================== =====================================

  6. #306
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    Q#75. C

    Buying Treasury debt would increase the money supply and so the interest rates will be lowered without changing the discount rate.

    Similar things are going in the US economy now as the Federal Reserve floods the market with cheap money.

  7. #307
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    Q#75 Answer: (C)

    Buying Treasury securities pumps money into the economy, lowering interest rates. Higher reserve requirements will restrict the money supply, causing rates to rise. The Federal Reserve has no direct control over the yield on existing Treasury securities.

    ================================================== =====================================
    Today's question (Questions and answers are provided by Austal Group)

    Q#76. Suppose that IBM has a $1,000 par value bond outstanding with a 12% semi-annual coupon that is currently trading at 102.25 with seven years to maturity. Which of the following is closest to the yield to maturity (YTM) on the bond?

    A. 11.21%
    B. 11.91%
    C. 11.52%

    ================================================== =====================================

  8. #308
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    Quote Originally Posted by vbadmin View Post
    Q#75 Answer: (C)

    Buying Treasury securities pumps money into the economy, lowering interest rates. Higher reserve requirements will restrict the money supply, causing rates to rise. The Federal Reserve has no direct control over the yield on existing Treasury securities.

    ================================================== =====================================
    Today's question (Questions and answers are provided by Austal Group)

    Q#76. Suppose that IBM has a $1,000 par value bond outstanding with a 12% semi-annual coupon that is currently trading at 102.25 with seven years to maturity. Which of the following is closest to the yield to maturity (YTM) on the bond?

    A. 11.21%
    B. 11.91%
    C. 11.52%

    ================================================== =====================================
    Ans C

  9. #309
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    Hi

    I might be going a little out of context here.
    But anybody has flashcards for Level 1?

    It will be really helpful. Thanks in advance.

    Regards

  10. #310
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    Q#76 Answer: (C)

    To find the YTM, enter PV =

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