Level I

Having trouble with this Econ Question about forward premiums and interest rates.

If the currency forward rate is trading at a premium, then relative to the interest rate of the domestic country, the interest rate in the foreign country is most likely:

higher.

the same.

lower.

Incorrect.

The currency with the higher (lower) interest rate will always trade at a discount (premium) in the forward market.

When do Futures and Forward prices differ and why?

I’ve found a lot of threads from the CFA lvl 2 exam on this, but I’m sure you need to know this on a much less detailed basis for the level1 exam. Does anyone know what we need to specifically know for level 1 in regards to why futures and forwards differ in price?

Thanks for the help (my apologies for starting so many threads, want to get all of the miscallaneous questions i’ve written down while studying for these past few months out of the way)

Eurobonds

Hello,

Would a bond issued in Germany denominated in US dollars and sold in Germany be considered a Eurobond?

Also, would a bond issued in Germany denominated in US dollars and sold in France be considered a Eurobond?

I believe the former is incorrect and the latter is correct but not certain.

CFA L1 Mock Exam Performance and Final Preparation

Hi

I’ll soon be taking the CFA Exam on Saturday. I’m worried as I have not been able to review 300 hours, and have only spent the past month in real study. I have tried to do the curriculum but have resorted to Schweser’s notes with brief looks at the curricilum when necessary.

My scores on the Practice Tests average 85.2%, and for the CFAI mock average 83.8%. No grade is below 70% except for Derivatives which are at around 58%.

Cash Inflow - investing activities

This is the question of the day from Kaplan, i don’t understand why A is wrong?

Which of the following would be recorded as a cash inflow from investing activities on the statement of cash flow?

a) gain on the sale of long-term assets

b) a period to period decrease in inventory

c) proceeds received from divestiture of a business

Their explanation is :

Advice for Final Two Days of Prep

First off, good luck to everyone taking L1 (whether for the first time, or on a retake).  Here are a few things that might be helpful for the last two days.

1) Try to get a good night’s sleep at least ONE  of the following two nights.  Being even a bit sleep deprived will cost you far more on the exam than those last 2-3 hours of study will gain you.  The CFA exam typically contains a lot of questions that aren’t really all that hard, but will have one or two little tweaks that will confuse you if you’re not well-rested.

Seat Assignment

How are seats assigned to candidates? Is it pre-planned or random?

Best of Luck

Wishing Y’all the very best in the forthcoming CFA exams. Goodluck!!!

Cheers

Goverment fiscal balance - Shift in AD

The goverment decides to reduce the spending along with a comparable reduction in taxes,

What is the effect on Aggregate demand?

I thought was a shift to the left due to the fiscal multiplier (the effect on a similar increase in G and T, the net impact in the fiscal policy will be positive). 

But the correct answer is the impact is indeterminate without further information… Why??

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