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Test Prep CFA-Level-I Exam Questions
CFA® Level I Chartered Financial Analyst (Page 112 )

Updated On: 24-Feb-2026
Page 112 of 793
PDF with 3963 Questions

A cumulative frequency distribution on days absent during a calendar year by employees of a manufacturing company is shown below.

Days AbsentCumulative Number of Employees
0 - 260
3 - 531
6 - 814
9 - 116
12 - 142

How many employees were absent fewer than six days?

  1. 60
  2. 91
  3. 46
  4. 31
  5. None of these answers

Answer(s): C

Explanation:

This is the difference between the cumulative numbers for the 0-2 group and the 6-8 group, 60 - 14 = 46. There are 46 people between those two groups and they were absent fewer than six days.



A perpetuity of $5,000 a year is priced at $40,000. The annual discount rate is:

  1. 12.5%
  2. 13.1%
  3. 11.8%
  4. 12.75%

Answer(s): A

Explanation:

If r is the discount rate, then 40,000 = 5,000/r, giving r = 12.5%



The formula for conditional probability is given by:

  1. P(A | B) = P(AB) / P(B)
  2. P(A | B) = P(AB) / P(A)
  3. P(A | B) = P(AB) * P(A)
  4. P(A | B) = P(AB) * P(B)

Answer(s): A

Explanation:

A conditional probability takes the form of P(A | B) = P(AB) / P(B), where P(B) does not equal 0. Note that this is just a rearranged form of the formula for joint probability.



The closing prices of a common stock have been 61 1/2, 62, 61 1/4, 60 7/8, and 61 1/2 for the past week. What is the range?

  1. None of these answers
  2. $1.750
  3. $1.875
  4. $1.250
  5. $1.125

Answer(s): E

Explanation:

62 - 60.875 = 1.125



You run a mutual fund that holds 24 stocks. Each week, you intend to comprehensively review 3 of them. Assuming this is the first week you are doing this, how many ways can you choose 3 from the 24?

  1. 2,024.
  2. 1,492.
  3. 1,024.
  4. 2,048.

Answer(s): A

Explanation:

The combination, or binomial formula, gives the number of ways that k objects can be chosen from n items, without regard to the order of choosing. The formula is n_C_k = (n choose k) = n! / [k! *(n-k)!]. In this case, we have (24 choose 3) = 24! / [3! * 21!] = (24 * 23 * 22 ) / (6!) = 2,024.






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