QUESTION: 725

What amount would you have in your savings account in 5 years, if it has a balance of $1,234 today and you deposit an additional $1,234 two years from today? Assume that the savings account earns 5% per year, compounded annually.

$10,048.91
$3,003.44
$2,468.00
$2,999.86
$3,149.86

Answer(s): B

Explanation:

Solve this question as two compound interest problems. The first $1,234 will be in the account for 5 years. The second $1,234 will be in the account for 3 years. Find the FV of both values 5 years from today and add them together. On the BAII Plus, press 5 N, 5 I/Y, 1234 PV, 0 PMT, CPT FV, which yields $1,574.93. Then press STO 1. Then press 3 N, CPT FV, which yields $1,428.51. Press + RCL 1 = to see the answer. On the HP12C, press 5 n, 5 i, 1234 PV, 0 PMT, FV. Then press STO 1. Then press 3 n, FV. Press RCL 1 + to see the answer.
Note that the answer will be displayed as a negative number. Make sure the BAII Plus has the P/Y value set to 1.

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QUESTION: 726

The probability that SUV sales will decline by over 10% by June 1 if gasoline prices increase by 50% by May 1, is called:

a lagged likelihood.
an unconditional probability.
a joint probability.
a conditional probability.

Answer(s): D

Explanation:

A conditional probability takes the form of P(A|B), the probability that a an event (A) will happen, given the occurrence of another event, B. It is conditional because it is conditioned on another event, B.

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QUESTION: 727

You are examining a group of 6 stocks within an industry. The industry average profit margin is expected to be 30%. For these stocks, the average profit margins have been 50%, 25%, 15%, 5%, 45%, and 30%. What is the mean absolute deviation of profit margins from the industry average?

13.3%.
13.7%.
13.5%.
13.0%.

Answer(s): A

Explanation:

The mean absolute deviation = the sum of (as i goes from 1 to n) of the absolute value of (X_i - Xbar), divided by n. Here, we have [|50% - 30%| + |25% - 30%| + |15% - 30%| + |5% - 30%| + |45% - 30%| + |30% - 30%|]/6 = 13.33%

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QUESTION: 728

A large group of inductees was given a mechanical aptitude and a finger dexterity test. The mean score on the mechanical aptitude test was 200, with a standard deviation of 10. The mean and standard deviation for the finger dexterity test were 30 and 6 respectively. What is the relative dispersion in the two groups?

Mechanical 5 percent, finger 20 percent
Mechanical 500 percent, finger 200 percent
Mechanical 20 percent, finger 10 percent
Mechanical 50 percent, finger 200 percent
None of these answers

Answer(s): A

Explanation:

The respective CVs are found from (s*100)/mean. Mechanical: 10*100/200 = 5% and Finger: 6*100/30 = 20%.

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Free CFA-Level-I Exam Braindumps (page: 182)

QUESTION: 725

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QUESTION: 726

Explanation:

QUESTION: 727

Explanation:

QUESTION: 728

Explanation: