CFA Level 1 Question and answer rated A+ 2023

CFA Level 1 Question and answer rated A+ 2023 n Factorial For a positive integer n, the product of the first n positive integers; 0 factorial equals 1 by definition. n factorial is written as n!. Accounting costs Monetary value of economic resources used in performing an activity. These can be explicit, out-of-pocket, current payments, or an allocation of historical payments (depreciation) for resources. They do not include implicit opportunity costs. Balance of payments A double-entry bookkeeping system that summarizes a country's economic transactions with the rest of the world for a particular period of time, typically a calendar quarter or year. M2 alpha Difference between the risk-adjusted performance of the portfolio and the performance of the benchmark. M2 A measure of what a portfolio would have returned if it had taken on the same total risk as the market index. Multi-factor model A model that explains a variable in terms of the values of a set of factors. Multilateral trading facilities Trading venues that function like exchanges but that do not exercise regulatory authority over their subscribers except with respect to the conduct of the subscribers' trading in their trading systems. Multi-market indexes Comprised of indexes from different countries, designed to represent multiple security markets. Multinational corporation A company operating in more than one country or having subsidiary firms in more than one country. Multiplication rule for probabilities The rule that the joint probability of events A and B equals the probability of A given B times the probability of B. Multiplier models Valuation models based on share price multiples or enterprise value multiples.