# AM Exam Answers

I notice that in the answer explanations they sometimes explain a definition in the answer. For example, they provide you with a list of options and then ask which you would use to create a cashless collar position. If you answer the question and just provide the combinations of options that would create the collar and don’t explain what a collar is - does that mean you won’t receive full credit?

Also, if you need to calculate something using a formula - should you write out the basic formula without numbers from the example first and then plug in the numbers? Would you then be more likely to receive partial credit because you fully explained that you’re using the correct formula?

I have the same question. For behaviors bias questions, do we have to explain the definition of related bias before providing explanation regarding the case?

I’m pretty sure you have to

Wouldn’t it depend on the type of question? i.e.:

I don’t think you would have to define cashless collar as they are asking you to create it; there isn’t any question as to what a cashless collar is

But for the behavioral questions to answer it you have to define what is the bias in order to explain why you chose that one.

I would just answer the question as is.

yea i def dont think you have to define things…and also answer the q. that said, some written answers ill include formulas and point to things (like sharpe stuff etc)

It depends on the keyword used in the question (e.g. Define, Describe, Compare etc.) and points the question carries. Check the definitions of all those keywords on CFA website. If question carries 4 points I would add more information if 1 point, I would straight go to the answer.

_ Command words_, not keywords.

Yes, Thanks for the correction!

I was wondering. suppose the selection (increase, no change, decrease) I had chosen/circled is correct, but my justification is absolutely wrong in the sense that I had totally not understood the concept. Will I still get the mark on my correction selection, even though it may have well been pure luck (33% chance) that I got it correct?

yes. if its a 4 point question, for instance, you would get 1/4 for circling the correct Question, and 0/3 for the explanation. this is actually one way in which CFAI throws us a bone on the AM, essentially making it more like MC.

that said, the scary questions are the 7 point ones where you have to circle a correct direction, and give a 6 point answer. you can make a ton of sense and say alot of correct things in your answer (and spend 7 minutes doing so) and still get a big fat 0/7 because you were directionally incorect.

You are saying the reverse is true as well, in that it may work against us instead. Means even if my justification fully answers the question, if I circled the wrong direction, I will get get ZERO marks? Damn…

How about the question asking “show your calculation”? Do we have to write the formula without numbers first? Or we can just plug in the numbers?

Here’s what CFA Institute wrote to me in an e-mail:

Once an answer is determined by circling a choice, it does not need to be defined in the justification, but rather justified as to why the answer was selected. Our advice is to focus on addressing the bold command words used in each question. In your example, justifying a particular bias would require citing facts about that client that indicate the presence of that bias.

You don’t have to define the bias.

I’m quite sure that you don’t. See above.

No, you don’t have to define it. See above.

Here’s what CFA Institute wrote to me in an e-mail:

A candidate is not required to explicitly show all variables and values of a formula; a correct answer on its own may be awarded full points. When answers are incorrect, partial credit may be awarded for completing part of the calculation or for correct formulas with some correct inputs. Therefore, if the question says “show your calculations,” it is in the candidate’s best interest to do so, for the potential to earn partial credit. Minor errors may have a significant effect on the points awarded; it varies by question and the type of partial credit available.

You don’t have to write the formula without the numbers.