CFA Institute Exam CFA-Level-I Topic 1 Question 5 Discussion

Actual exam question for CFA Institute's CFA Level I Chartered Financial Analyst exam

Question #: 5
Topic #: 1

[All CFA Level I Chartered Financial Analyst Questions]

Assume an investor makes the following investments:

During year one, the stock paid a $5.00 per share dividend. In year 2, the stock paid a $7.50 per share dividend. The investorâ€™s required return is 35.0 percent.

The dollar-weighted return is:

A48.9%.

B16.1%.

C46.5%.

D102.4%.

Show Suggested Answer

Suggested Answer: A

by Joesph at Sep 15, 2024, 10:17 PM

Limited Time Offer

25%

Off

Get Premium CFA-Level-I Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Yvonne

16 days ago

This question is making my head spin like a fidget spinner. But I'm pretty sure the answer is C. 46.5%. Gotta love those tricky finance questions!

upvoted 0 times

...

Curt

22 days ago

But the required return is 35.0 percent, so the answer should be A) 48.9%.

upvoted 0 times

...

Krystal

28 days ago

I disagree, I believe the answer is C) 46.5%.

upvoted 0 times

...

Ashley

1 months ago

D. 102.4%? That can't be right. The dividends and required return don't add up to that high of a return. I'm going with C.

upvoted 0 times

Candra

1 days ago

I think you might be right, C does seem like a more reasonable option.

upvoted 0 times

...

Curt

1 months ago

I think the answer is A) 48.9%.

upvoted 0 times

...

1 months ago

The answer has to be C. 46.5%. The dividends and required return give us enough information to calculate the dollar-weighted return.

upvoted 0 times

Roxane

1 months ago

No, I believe it's C) 46.5%.

upvoted 0 times

...

Dierdre

1 months ago

I think the answer is A) 48.9%.

upvoted 0 times

...