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  1. Home
  2. CFA Certification
  3. CFA-Level-I Exam
  4. CFA.CFA-Level-I.v2024-01-19.q367 Dumps
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Question 261

According to advocates of the quantity theory of money, a government that attempts to maintain a high level of output is likely to:

Correct Answer: C
Inflation undermines growth by creating uncertainty, by making it more difficult for businesses to enter into contracts, and by increasing the costs of avoiding inflation.
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Question 262

Even though Mary's income is very low, she makes sure that she purchases enough milk for her family to drink. As her income rises, she does buy more milk. Which graph in Figure 5.3 best represents
Mary's Engel curve for milk?

Correct Answer: B
Note that C indicates that even if her income is very low (zero) she still buys "enough" milk.
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Question 263

The format of the income statement that shows several intermediate profit measures is called the
_ ______.
A single-step format
B. multiple-step format.
C. operating-profit format.

Correct Answer:
B
Explanation: The multiple-step format provides several intermediate profit measures including gross profit, operating profit, and earnings before income tax before presenting the net income for the period.
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Question 264

A stock jumps 10% in one trading day after being in a long downtrend, The volume for the day is below average. Technicians usually interpret this as a sign of a:

Correct Answer: B
A divergence is a contradiction between two different indicators. The simplest example of divergence is a clear upward trend on declining volume.
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Question 265

For T-bills (no risks), the risk aversion coefficient:

Correct Answer: C
Since the variance is 0 for T-bills, the utility is always the same (expected return) no matter if the investor is risk averse or not.
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