Test Prep CFA-Level-I Exam Prep
CFA® Level I Chartered Financial Analyst (Page 8 )

• Storage usage of files stored in Microsoft Teams: SharePoint site usage report

• Number of active users per team: Microsoft Teams usage report

1. SharePoint site usage report
2. Microsoft Teams usage report

• A — Too infrequent: Formal strategies are often reviewed only every three to five years. This can make the organisation slow to respond to rapid changes in technology, competitors, regulation or customer needs.

• C — Relies on predicting the future: The approach assumes senior managers can make reasonably reliable forecasts and assumptions. In uncertain environments, these assumptions may quickly become invalid.

• E — Can restrict radical innovation: Formal planning tends to favour existing information, established objectives and incremental improvements. This may discourage experimental or highly innovative strategies that emerge from lower levels of the organisation.

• B concerns the difficulty of achieving competitive advantage through core competences when competing with focused specialists. It is not specifically a drawback of the formal top-down planning process.
• D is an activity organisations should undertake—continuous monitoring—not a drawback of the approach itself.

• Microservices: An application design approach that divides software into small services; it does not specifically reduce the number of operating systems.
• Containerization: Uses isolated containers that share the host OS kernel—best match.
• Virtualization: Creates separate virtual machines, and each typically requires its own guest OS, so it does not minimize OS instances as effectively.
• Infrastructure as code: Automates deployment and management of infrastructure; it does not describe the architecture being used.

text 
ip route vrf Customer1 172.16.1.0 255.255.255.0 172.16.1.1 global 
ip route vrf Customer2 192.168.1.200 255.255.255.255 192.168.1.1 global 
ip route 192.168.1.0 255.255.255.0 Vlan10 
ip route 172.16.1.0 255.255.255.0 Vlan20

• The route in Customer1 VRF provides a path back to the Customer2 subnet, 172.16.1.0/24.
• The route in Customer2 VRF provides a path to the FTP server, 192.168.1.200.
• The keyword global tells the router to resolve the next hop using the global routing table, enabling controlled route leaking between the VRF and global table.
• The global routes identify the VLAN interfaces used to reach each customer network.

• D — Value analysis: Correct. It examines an existing product to identify ways of reducing its cost while still providing the required functions, quality and reliability.
• E — Kaizen costing: Correct. It involves making continuous, small improvements and cost reductions while the product is already in production.

• Functional analysis: It is not limited to minimizing the cost of the originally defined functions. It examines what functions are required and how they can be provided at the lowest overall cost.
• Value engineering: Usually applies to the design and development of a new product, rather than being a fundamental redesign of existing organisational processes. That description is closer to business process re-engineering.
• Target costing: The target cost is generally established during the product development stage, before production begins. It is not continuously reset while the product is in production.

• Replaces the verbal message — this describes non-verbal communication being used instead of words.
• Substitutes for verbal communication — similar; it means communicating without speech.
• Confuses the verbal message — this occurs when non-verbal signals contradict or obscure the spoken message.

• Maintain head office control: Transfer pricing generally supports decentralisation rather than direct head-office control.
• Establish centralised decision making: This conflicts with divisional autonomy.
• Develop a top-down culture: Transfer pricing is intended to support empowered divisions and goal congruence, not impose purely top-down management.

• Each Azure VM must have at least one network interface (NIC).
• A single NIC can have:

• Therefore, each of the five VMs needs only one NIC:

• Honeypots: Deliberately vulnerable or attractive systems designed to lure attackers. Legitimate users should not access them, so activity on a honeypot is a strong indicator of compromise.
• DNS sinkholes: Redirect requests for known malicious domains to a controlled internal system instead of allowing the connection. This can identify infected hosts attempting to contact command-and-control infrastructure.

• Tokenization: Replaces sensitive data with non-sensitive tokens; it protects data but does not primarily detect attackers.
• CI/CD: Automates software development and deployment processes.
• Threat modeling: Identifies potential threats and weaknesses before or during system design.
• Data obfuscation: Makes data harder to understand, but it is not an attacker-detection method.

• The selling division receives a credit based on a favourable transfer price, often market price or full cost plus a profit margin.
• The receiving division is charged a lower amount, such as marginal cost or another agreed price.
• The difference is accounted for centrally by head office or a corporate adjustment.

• Laws and regulations
• Litigation holds
• Industry or contractual obligations
• Tax, financial, health, or privacy requirements

• Business strategy and direction: May influence retention, but cannot override legal requirements.
• Storage capacity and longevity: Practical considerations, not the primary driver.
• Business ease and value analysis: May support decisions after compliance obligations are identified.

• Which host first communicated with the suspected malicious source
• Whether that host initiated suspicious traffic or merely received it
• Which other hosts show evidence of infection, such as connections from the originating host
• Which hosts have no related suspicious activity and are therefore clean

• An outbound connection to a suspicious external address
• A downloaded or executed malicious file
• Later lateral connections from that host to other internal systems
• Firewall logs showing the direction and timing of the traffic

1. Clear principles and boundaries — Employees have freedom, but decisions must remain within clear organizational values, policies and limits.
2. High degree of freedom — Managers are trusted to make decisions rather than seeking continual approval from senior management.
3. Frontline customer responsibility — Customer-facing managers should be empowered to manage customer relationships and respond quickly to needs.
4. Transparent and ethical information — Information should be openly available and used honestly, supporting trust and informed decision-making.

• Restarting the device: May fix software glitches, but would not usually make cable orientation matter.
• Swollen battery: A safety concern, but it would not typically cause recognition only in one cable orientation.
• Failing cable: Possible, but less likely because the problem occurs with this particular device and not other devices of the same type.

• Honeypots: Decoy systems or services made to attract attackers. Legitimate users should not interact with them, so activity there is a strong indicator of malicious behavior.
• DNS sinkholes: Redirect requests for known malicious domains to a controlled internal system. This can reveal infected hosts attempting to contact command-and-control infrastructure.

• Tokenization: Replaces sensitive data with non-sensitive tokens.
• CI/CD: Automates software development, testing, and deployment.
• Threat modeling: Identifies and analyzes potential threats before or during system design.
• Data obfuscation: Makes data harder to understand or interpret.

• Portfolio definition cycle — establishes and maintains the portfolio strategy, objectives, and management framework.
• Portfolio delivery cycle — coordinates and monitors the delivery of change initiatives, ensuring the portfolio remains aligned with strategic objectives and delivers value.

• Practice — a structured area of portfolio management activity, such as risk management or resource management.
• Technique — a method used to perform an activity; it is not the term for portfolio delivery itself.
• Principle — a guiding rule for effective portfolio management.

• A: Reduce management overhead — This is generally an advantage of public cloud, not hybrid cloud. Hybrid environments can increase management complexity.
• B: Cross-platform virtualization — Not the defining advantage of hybrid cloud.
• D: Leverage IaaS and PaaS — Public clouds commonly provide both IaaS and PaaS, so this is not unique to hybrid cloud.

• Load balancer: Distributes application traffic; it does not protect switch MAC tables.
• IPS: May detect some attack traffic, but it is not the primary control for switch-port MAC learning.
• NGFW: Protects at network boundaries but does not directly limit MAC addresses learned on access ports.

• IRR assumes that interim cash flows can be reinvested at the project’s own IRR. This may be unrealistic, especially when the IRR is very high.
• MIRR assumes reinvestment at a specified rate, usually the company’s cost of capital or another realistic reinvestment rate.

• B: MIRR does not specifically favour projects with long payback periods.
• C: MIRR and IRR can rank competing projects differently.
• D: MIRR is not always higher than IRR; it may be higher or lower depending on the cash flows and reinvestment rate.

• How quickly the vendor must respond to an incident or request
• Target resolution times
• Availability or uptime requirements
• Performance metrics and penalties for not meeting them

• SOW (Statement of Work): Describes the project’s scope, tasks, deliverables, and timeline.
• MOA (Memorandum of Agreement): Documents a formal agreement to cooperate or perform specific activities.
• MOU (Memorandum of Understanding): Records a mutual understanding or intent, often less binding than a contract.

• CSIRT: A Computer Security Incident Response Team that handles and coordinates incident response.
• CVSS: A scoring system used to rate the severity of vulnerabilities.
• SOAR: Security Orchestration, Automation, and Response technology used to automate security workflows.

• Reduce the training data: Usually makes overfitting worse.
• Add hyperparameters: Hyperparameters already control training; simply adding them does not solve the problem. Proper tuning could help, but that is not what the option states.
• Increase training time: More training can worsen overfitting if the model is already memorizing the training data.

• Required response and resolution times
• Availability or uptime targets
• Performance standards
• Support obligations
• Remedies or penalties for failing to meet the terms

• SOW (Statement of Work): Defines the project’s scope, tasks, deliverables, and schedule.
• MOA (Memorandum of Agreement): Describes agreed responsibilities between parties, often for a specific activity.
• MOU (Memorandum of Understanding): Records a mutual understanding or intention, usually less formal than a contract.

• A — Securing information assets: This is the responsibility of management and operational/security teams.
• B — Validating protection: Correct. The auditor checks whether controls—such as access restrictions, encryption, retention, and handling procedures—match the asset’s classification.
• C — Ensuring alignment with regulations: Management and legal/compliance functions typically establish classification requirements; the auditor may assess compliance but does not primarily define alignment.
• D — Defining classification levels: This is a management responsibility based on business needs, risk, and regulatory obligations.

• A user connects with their Google account.
• Google associates the user’s SSH key with that identity.
• IAM roles determine whether they can log in.
• Access can be tied to a specific employee for auditing.
• Removing the IAM role removes their login access.

• compute.osLogin: regular OS login access
• compute.osAdminLogin: OS login with administrative privileges, typically including sudo

text 
enable-oslogin=TRUE

• 10 TB with maximum I/O performance: Use EC2 instance store. It provides very high-throughput, low-latency local storage suitable for temporary video-processing data. The application must tolerate data loss because instance store is ephemeral.
• 300 TB of highly durable media: Use Amazon S3, which is designed for highly durable object storage and can scale to this size.
• 900 TB of inactive archival media: Use S3 Glacier, which provides lower-cost storage for data that is rarely accessed.

• A: Amazon EBS offers high performance but is not the best fit for the question’s “maximum possible I/O” requirement compared with local instance store.
• B: Amazon EFS is durable and shared, but is generally more expensive and less suitable for very large archival storage.
• C: Uses EC2 instance store for performance, but incorrectly uses EFS for the 300-TB durable tier and S3 rather than Glacier for archival data.

• Endpoint Manager: manages hosts and sensor-related settings.
• Falcon Investigator: supports investigation and analysis, but does not necessarily grant RTR access.
• Remediation Manager: handles remediation-related actions rather than interactive host access.

• The S3 bucket as an origin for static content
• The Application Load Balancer (ALB) as an origin for dynamic content
• An Amazon Route 53 alias record pointing the application domain to CloudFront

Why this works

• Static data: CloudFront caches objects from S3 at edge locations, reducing latency for users worldwide.
• Dynamic data: CloudFront forwards requests that require application processing to the ALB. It can also maintain persistent connections and use the AWS global edge network to improve delivery performance.
• One domain: CloudFront behaviors can route different path patterns to different origins—for example, /static/* to S3 and other paths to the ALB.

Why the other options are incorrect

• Global Accelerator is designed primarily for accelerating traffic to applications with endpoints such as ALBs, not for caching S3 content.
• Using separate domains or splitting static and dynamic traffic adds unnecessary complexity.
• CloudFront already provides the required global edge distribution and caching, so combining it with Global Accelerator is unnecessary here.

• Financial performance
• Customer perspective
• Internal business processes
• Learning and growth

• Increasing the number of indicators can make the scorecard cluttered and less useful. Measures should be limited to those that are strategically important.
• The scorecard is mainly a tool for implementing and monitoring strategy, not for formulating strategy.
• It should contain both leading indicators and lagging indicators. Leading indicators predict future performance, while lagging indicators measure results already achieved.

Statement 1 — Correct

Statement 2 — Correct

• If the hashes match, the software has likely not changed.
• If they differ, the software was modified or corrupted.

• Encryption: Protects confidentiality by making data unreadable; it does not primarily verify that software was unchanged.
• Baselines: Establish expected configurations or states, but hashing is the specific method for checking file integrity.
• Tokenization: Replaces sensitive data with non-sensitive tokens and is unrelated to software integrity.

• Vulnerability scanner: Finds technical weaknesses in systems, applications, or devices. It does not usually analyze the entire supply chain.
• Penetration test: Simulates attacks against a defined target to identify exploitable weaknesses. Its scope is narrower.
• SCAP (Security Content Automation Protocol): Provides standardized formats and methods for automating security configuration and vulnerability checks, rather than mapping the full supply chain.

• Threat perspective: Focuses on possible attacks, but may seem technical or hypothetical.
• Compliance perspective: Can motivate action, but compliance alone does not demonstrate the broader business value of governance.
• Policy perspective: Policies are important, but they are a means of implementing governance, not its primary business justification.

• Two-part tariff pricing: $10 per unit
• Dual pricing: $20 per unit

Two-part tariff pricing

Dual pricing

• Division X, the seller, is credited with the market price: \(\$20\)
• Division Y, the buyer, is charged the marginal cost: \(\$10\)

• Accept: Acknowledges the risk without taking additional action.
• Transfer: Shifts the risk or financial impact to another party, such as an insurer.
• Mitigate: Reduces the likelihood or impact through controls like patching, MFA, or segmentation.
• Avoid: Eliminates the activity that creates the risk.

• contoso.onmicrosoft.com
• contoso1.onmicrosoft.com

• onmicrosoft.com domains: Maximum of five per tenant.
• Custom domains: Domains that your organization owns and verifies in Microsoft 365.

• Transport and handling
• Storage and warehousing
• Refrigeration
• Shelf-stacking or replenishment
• Other costs directly attributable to product P

• B. Users accessing Salesforce from public Wi-Fi

• C. Users choosing the same password as their Facebook password

• A: 2FA does not protect an already-authenticated, unlocked session if someone accesses an unattended laptop.
• D: Weak password-reset questions are an account-recovery weakness. 2FA primarily strengthens login authentication, not necessarily the security-question reset process.

sql 
CREATE PROCEDURE dbo.usp_CreateOrder 
AS 
BEGIN 
    SET NOCOUNT ON; 
    SET XACT_ABORT ON; 


    BEGIN TRY 
        BEGIN TRANSACTION; 


        INSERT INTO dbo.Orders (/ columns /) 
        VALUES (/ values /); 


        SET @OrderID = SCOPE_IDENTITY(); 


        COMMIT TRANSACTION; 
    END TRY 
    BEGIN CATCH 
        IF @@TRANCOUNT > 0 
            ROLLBACK TRANSACTION; 


        THROW; 
    END CATCH; 
END;

• BEGIN TRY contains the transactional work.
• SCOPE_IDENTITY() retrieves the identity generated by the INSERT; it belongs after the insert, not as the error-handling logic.
• COMMIT runs only if all statements succeed.
• BEGIN CATCH handles failures.
• IF @@TRANCOUNT > 0 prevents attempting a rollback when no transaction is active.
• ROLLBACK undoes partial changes.
• THROW re-raises the original error with consistent details for the application.
• SET XACT_ABORT ON ensures many run-time errors automatically terminate and roll back the transaction.

• A — Correct: Identify the data required by Salesforce, its dependencies, and how it should be validated. Verification scripts help confirm record counts, relationships, field mappings, and data integrity after migration.
• D — Correct: Use a full sandbox and perform trial migrations using realistic—or appropriately masked—legacy data. This exposes transformation, volume, dependency, and integration issues before production cutover.
• B — Less appropriate: Phased user migration and parallel operation primarily address user adoption and rollout risk, not the technical risks of data migration.
• C — Less appropriate: Although sandbox testing and integration testing are valuable, the option emphasizes test-data generation rather than validating the migration with representative legacy data. “A full sandbox for all systems” may also be impractical.

• D — Create sibling resource pools for the Production VMs and Test VMs.

• B — Configure a memory reservation on the Production resource pool.

• Shares only determine relative priority when resources are scarce; they do not guarantee memory.
• A parent resource pool alone does not provide a guarantee.
• A child pool for Test VMs does not reserve memory for Production.

• A static IP gives the surveillance system a predictable local address, so users can reliably reach it on the LAN.
• However, a static IP does not block internet-based login attempts. If the router exposes the device through port forwarding, attackers could still reach it.
• Port mapping normally exposes an internal service externally, so A is a poor choice as written.
• Subnetting alone also does not block traffic; it would require routing/firewall rules.

• Inherent risk: Risk that exists before controls are implemented.
• Avoided risk: Risk eliminated by choosing not to perform the risky activity.
• Operational risk: Risk arising from failures in processes, people, systems, or daily operations.

• Server provisioning
• Operating systems and runtime infrastructure
• Scaling
• Much of the maintenance and patching

• Thin clients reduce endpoint hardware requirements but do not specifically streamline code deployment.
• Private cloud provides dedicated cloud infrastructure but usually requires more management and expense.
• Virtual machines improve resource utilization, but administrators still manage the VMs, operating systems, and deployments.

• Periodic vulnerability assessments: Identify technical weaknesses but do not establish governance or ensure risks are managed.
• Established information security metrics: Help measure performance and report status, but measurement alone does not make governance effective.
• Advanced security technologies: Support security operations, but governance is primarily about direction, accountability, decision-making, and alignment with business objectives.

Why this is correct

• Each user authenticates with their own Google account.
• Google manages the user’s SSH key association.
• IAM controls who can access instances.
• Access can be audited by user identity, so security can determine who accessed a VM.
• Granting the role to a Google group avoids managing permissions individually.

Why the others don’t apply

• A: A shared private key is difficult to distribute securely and cannot reliably identify which employee used it.
• B: Manually collecting and deploying keys on every instance is operationally inefficient and complicates auditing.
• D: A project-wide shared key has the same identity and key-management problems as option A. It also does not provide per-user accountability.

• File1.png — Yes: User1 can apply Label1 with the Microsoft Purview Information Protection client. The client supports labeling image files such as .png in this scenario.

• Folder2 — No: Folder2 is the root folder. The client does not allow labeling the root folder itself. Although the client can label ordinary folders, selecting one applies the label to existing files and subfolders—not automatically to future files.

• File1.docx — Yes: .docx is a supported Microsoft Word file type, so User1 can apply Label1 to it.

• Existing measures
• Relationships
• Calculated columns
• Tables and fields
• Existing transformations in the model

• SharePoint folder: Reconnects to the source files. You would likely need to recreate the model and measures.
• Power BI dataflows: Primarily provide reusable data preparation and storage, but they do not automatically provide the existing semantic model and measures.
• Excel workbook: Connects directly to the source file and would also require rebuilding the model and measures.

• Economy: Obtaining inputs at the lowest appropriate cost.
• Efficiency: Making the best use of resources, such as staff, money, and equipment.
• Effectiveness: Achieving the intended objectives or outcomes.