I’m not sure if this is a trick, or I’ve just been lucky, but a lot of times I don’t even do the quantitative questions because based on the answers I know which one is correct. For example, if CFA is asking for EAR on a loan, and it gives you the original term rate (LIBOR +X) and the call option that is purchased (Strike at Y) and then the final ending rate at option expiration (Z) the multiple choice will usually be:
A) Z
B) New Number not mentioned in problem set at all
C) LIBOR+X
If the option strike Y is lower than the ending rate, Z, then I know the answer is B. Likewise if the option is out of the money, then the EAR will just be close to the LIBOR+X, or C. It might be slightly higher if the premium is super high on the option but you get my point. Does anyone else do this? Is this luck or just a benifiting from understanding what the answer should look like?
I do something similar, before I even begin my calc I try to eliminate a number that looks wrong. That said, I always end up doing the calc as a check.
I do that as a last resort only… and I guess wrong 66.66% of the time. I think it is nearly impossible to game their answers. They are rarely as simple to eliminate like you mentioned, but I am curious to hear more about your strategy if it actually does work and you are not just exhibiting representative bias - sample size neglect.
Well with every topic it changes, but usually if the answers include numbers mentioned in the problem set, I don’t need to do the calculations. This obviously doesn’t apply to all questions, but when they do I usually pick and then come back to do the calc and it still works.
Maybe it’s not for everyone, but I think if timing is a concern and you have a conceptual understanding of certain subjects, sometimes that’s all you need to be able to pick the right answer.
On the l2 test, I always tried to tie out to the wrong answers with incorrect methods. It helped up my confidence in my choices. Was typically able to tie out to 1/2 the math q’s
i only do stuff like this when i havent a clue how to work out the problem - which equates to 50% of the exam. MAHAHAHAHHHHHHHHHHHHHHHHHAAAAAAAAAAAAAAAAAAA