CFA-Level-l Exam Practice Questions Answer.pdf

Question: 12
Ket Garo, CFA tells his employer that he was chosen by faculty in his undergraduate to represent his
college in a national asset management competition. In reality, Garo was not selected and did not
participate in the competition. Which Standards has Garo most likely violated?
A. Duties to Employers
B. Professional Misconduct
C. Duties to Clients
Question: 13
Answer: B
Sophia Wright is the investment manager for several institutional clients. Wright directs trades on behalf of
her clients to BAQ Securities. In return BAQ pays for a yearly vacation for Wright and provides Wright with
equity research that she uses for making investment decisions for her clients. Wright does not disclose this
arrangement to her clients. BAQ also does not provide the best price and execution. Wright has violated:
A. No violations if the equity research leads to positive returns for clients.
B. No violations if the yearly vacations are inexpensive.
C. Standard III (A) Loyalty, Prudence and Care.
Question: 14
Answer: C
Isabella Walker offers credit guidance to purchasers of corporate bonds. Her firm has a large inventory of
bonds of TPQ Corp. which is facing financial difficulties. The sales department of her firm asks her to
recommend TPQ bonds to her clients. After analyzing the bonds Walker concludes that they are
underpriced,even after accounting for TPQ's financial difficulties. Walker next contacts her clients and
recommends they purchase TPQ's bonds. Walker has:
A. violated only Standard I (B) Independence and Objectivity.
B. not violated the Standards.
C. violated Standard I (B) Independence and Objectivity and Standard III (C) Suitability.
Answer: B
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