CFA Level 1 Free Practice Test

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5 questions will be shown from a total of 30 free practice questions to prepare you for CFA level 1 exam. Enjoy!

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1. Which of the following forms of trading blocs allow for unrestricted trade of goods and services among its members?

I. Free trade areas
II. Customs unions
III. Common market

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2. Company XYZ purchases land for USD5,000,000. XYZ intends to hold the land for a long term (20 years) and rent the land out to generate income. Under IFRS, at which price is the company allowed to use on its financial reports for the value of the land:

I. USD5,000,000
II. The current market price

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3. Meta Corp. sells 15,000 units of its product at a price of USD10 per unit. The company’s fixed costs are USD12,000 and interest expense is USD3,000. The variable cost per unit is USD7.

Meta Corp’s degrees of operating leverage and financial leverage are:

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4. Given the following data, determine the cash flow from operations:

Sales = USD2,100m
Increase in inventory = USD200m
Depreciation = USD125m
Increase in accounts receivable = USD75m
Decrease in accounts payable = USD70m
After tax profit margin = 35%
Gain on sale of machinery = USD30m

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5. The standard deviation of the market portfolio is 0.2. The beta of a company with standard deviation 0.6 and market correlation of 0.4 is closest to:

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