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  1. Home
  2. CFA Certification
  3. CFA-Level-I Exam
  4. CFA.CFA-Level-I.v2022-12-16.q776 Dumps
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Question 21

Brian takes out $200 from an ATM against his checking account at his bank. He then gives the money to Rick who deposits the whole $200 in his checking account at bank (a different from that of
Brian's). In theory after the process finishes, the bank reserves will ______ and the M1 money supply will
_ _____.

Correct Answer: A
There should be no change in either bank reserves or M1. The process is just a transfer of money from one bank to another, and these two banks have the same reserve requirement and should maintain identical reserves. M1 remains the same because the total amount of deposits in the economy is the same: the money supply is affected only by injections of money by the Fed.
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Question 22

The audit committee should ensure that if there are any conflicts of interest between the external auditor and the Company, they should be resolved in favor of the

Correct Answer: A
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Question 23

Refer to the graph below. If this firm were forced to set price equal to marginal cost, it would likely:

Correct Answer: C
It would stop producing because it cannot cover its average costs.
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Question 24

A survey of 144 retail stores revealed that a particular brand and model of a VCR retails for $375 with a standard deviation of $20. If 90% and 95% confidence intervals are developed to estimate the true cost of the VCR, what similarities would they have?

Correct Answer: C
The point estimates and the standard errors will be the same. The z-values will differ according to the area under the curve.
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Question 25

When finding a confidence interval for the population mean, when is t-score used as the critical value
(assume the population is normally distributed)?

Correct Answer: A
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