Free CFA-Level-I Exam Braindumps (page: 195)

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The mean of a normal distribution is 400 pounds. The standard deviation is 10 pounds. What is the area between 415 pounds and the mean of 400 pounds?

  1. None of these answers
  2. 0.4332
  3. 0.3413
  4. 0.1932
  5. 0.5000

Answer(s): B

Explanation:

z = (x-u)/sigma. z = 415 - 400/10 = 1.5. From the z-tables, z = 1.5 is 0.4332. Since we are considering just one side of the distribution and the area from the mean, then the area between the points is 0.4332.



Four of your firm's analysts have been chosen as finalists for the Wealth Magazine All-Star Analysts team. They will get different bonuses depending on the order in which they finish among themselves. How many different ways could they finish?

  1. 10.
  2. 24.
  3. 16.
  4. 36.

Answer(s): B

Explanation:

The factorial method allows you to determine the number of ways of arranging n things. Initially, there are n choices for the first item, then n-1 for the second, and so on. The number of combinations is therefore n! = n * (n-1) * (n-2) * (n-3) * ... * (1). Here, we wish to find out how many different orders can be made with 4 persons.
The answer is 4! = 4 * 3 * 2 * 1 = 24.



If you deposit $2,000 today, how much will you have in 3 years, if interest is earned at a rate of 8% per year, compounded annually?

  1. $2,519.42
  2. $2,576.14
  3. $2,400.00
  4. $3,121.88
  5. $2,614.09

Answer(s): A

Explanation:

On the BAII Plus, press 3 N, 8 I/Y, 2000 PV, 0 PMT, CPT FV. On the HP12C, press 3 n, 8 i, 2000 PV, FV. Note that the answer will be displayed as a negative number. Make sure the BAII Plus has the P/Y value set to 1.



What are the critical values for a two-tailed test of hypothesis test if alpha = .01?

  1. +/- 1.645
  2. +/- 2.58
  3. +/- 1.96
  4. None of these answers
  5. +/- 2.33

Answer(s): B

Explanation:

For a level of significance of 0.01, we can find the z value by 1.0 - 0.505 = 0.495 which is 2.58.






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