This is such a bloody dumb question, I can’t believe I’m asking it.
Did the CFAI provide guidance about how many significant digits we’re supposed to use in calculations or whether we’re supposed to round up or down? - Maybe somewhere in our Level I readings?
Ex. I calculated net income of $4.7245 for Q 6, Reading 34. The answer uses net income of $4.724 - so the CFAI uses 3 significant digits and didn’t round up.
I ask because the fewer the significant digits we should use, the quicker it is to performs the calcuations. More importantly for some questions, when I use too many significant digits (or too few) I arrive at an answer that is between two choices given and I don’t know which one to pick.
(If I calculate an answer to 3 significant digits, my calculation - an HP 12C - will round the last significant digit instead of truncating it. In my example above, NI would be $4.725 - not the $4.724 used by CFAI.)
Somewhere in derivatives (for a currency calc?) the curriculum mentions its wise to use 8 digits there instead of the standard four (since most of the numbers in the calcs are to the tune of .0XXX).
I have faith the CFAI isnt going to ask a question on the exam that is susceptible to errors from logical rounding - they have a year to come up with just 120 questions. It is annoying though when one author uses dramatically different rounding from the next.
I’ve typically found this is only a problem when doing EOCs or Blue Boxes that are not multiple choice and you’re calculating an “exact” answer.
As hock mentioned above, when the question is multiple choice, the answers are varied enough so that rounding would not come into play and only one choice can possibly be correct.