Ethics questions with answers rated
100% correct.
Ethical conduct is behavior that follows moral principles and balances self-interest with both the direct
and the indirect consequences of the behavior on others. ANS -
The publication of Graham and Dodd's Security Analysis in 1934 was an important step in establishing a
body of knowledge for investment. ANS -
In most countries, skilled evaluation of securities leads to more efficient capital allocation and,
combined with ethical corporate governance, can assist in attracting investment from international
investors ANS -
The mission of CFA Institute is "to lead the investment profession globally, by promoting the highest
standards of ethics, education, and professional excellence for the ultimate benefit of society." ANS -
The CFA Institute Code of Ethics and Standards of Professional Conduct (Code and Standards) promote
the integrity of charterholders and establish a model for ethical behavior. ANS -
The CFA Institute Global Body of Investment Knowledge (GBIK) and Candidate Body of Knowledge
(CBOK) are updated on an ongoing basis through a process known as practice analysis. ANS -
CFA charterholders and CFA Program candidates are required to adhere to the Code and Standards and
to sign annually a statement attesting to that continued adherence. ANS -
As a result of the _________ _______, we are more likely to overestimate the morality of our own
behavior, particularly in situations that we have not faced before. ANS -overconfidence bias
decision makers often fail to recognize and/or significantly underestimate the effect of ________
influences ANS -situational
bystander effect ANS -people are less likely to intervene in an emergency when others are present
,Loyalty to employer and/or colleagues is an extremely powerful situational influence ANS -
A compliance approach may not encourage decision makers to consider the larger picture and can
oversimplify decision making. ANS -
laws typically follow market practices ANS -
Laws are also subject to interpretation and compliance by market participants, who may choose to
interpret the law in the most advantageous way possible or delay compliance until a later date. ANS -
Identify: Relevant facts, stakeholders and duties owed, ethical principles, conflicts of interest ANS -
Consider: Situational influences, additional guidance, alternative actions ANS -
Decide and act ANS -
Reflect. Was the outcome as anticipated? ANS -
It is helpful to distinguish between facts and personal opinion, judgements, and biases. You will also
want to identify the stakeholders—clients, family, colleagues, your employer, market participants, and
so forth—and the duties you have to each of them. ANS -
in 1992, CFA Institute added the standard addressing performance presentation to the existing list of
standards. ANS -
The comprehensive review of the Code and Standards in 2005 resulted in principle requirements that
remain applicable today. The review carried out for the eleventh edition focused on market practices
that have evolved since the tenth edition ANS -
the eleventh edition includes an update to the Code of Ethics that embraces the members' role of
maintaining the social contract between the industry and investors. ANS -
, Updated vision:
To lead the investment profession globally by promoting the highest standards of ethics, education, and
professional excellence for the ultimate benefit of society. ANS -
One of the bullets in the Code of Ethics was updated to reflect the role that the capital markets have in
the greater society.
Old:
Promote the integrity of and uphold the rules governing capital markets.
New:
Promote the integrity and viability of the global capital markets for the ultimate benefit of society. ANS
-
New Standard Regarding Responsibilities of Supervisors [IV(C)] ANS -The updated version stresses
broader compliance expectations, which include the detection and prevention aspects of the original
version.
Additional Requirement under the Standard for Communication with Clients and Prospective Clients
[V(B)] ANS -the standard regarding communicating with clients now includes an implicit requirement to
discuss the risks and limitations of recommendations being made to clients.
Modification to Standard VII(A) ANS -Old:
Conduct as Members and Candidates in the CFA Program
New:
Conduct as Participants in CFA Institute Programs
100% correct.
Ethical conduct is behavior that follows moral principles and balances self-interest with both the direct
and the indirect consequences of the behavior on others. ANS -
The publication of Graham and Dodd's Security Analysis in 1934 was an important step in establishing a
body of knowledge for investment. ANS -
In most countries, skilled evaluation of securities leads to more efficient capital allocation and,
combined with ethical corporate governance, can assist in attracting investment from international
investors ANS -
The mission of CFA Institute is "to lead the investment profession globally, by promoting the highest
standards of ethics, education, and professional excellence for the ultimate benefit of society." ANS -
The CFA Institute Code of Ethics and Standards of Professional Conduct (Code and Standards) promote
the integrity of charterholders and establish a model for ethical behavior. ANS -
The CFA Institute Global Body of Investment Knowledge (GBIK) and Candidate Body of Knowledge
(CBOK) are updated on an ongoing basis through a process known as practice analysis. ANS -
CFA charterholders and CFA Program candidates are required to adhere to the Code and Standards and
to sign annually a statement attesting to that continued adherence. ANS -
As a result of the _________ _______, we are more likely to overestimate the morality of our own
behavior, particularly in situations that we have not faced before. ANS -overconfidence bias
decision makers often fail to recognize and/or significantly underestimate the effect of ________
influences ANS -situational
bystander effect ANS -people are less likely to intervene in an emergency when others are present
,Loyalty to employer and/or colleagues is an extremely powerful situational influence ANS -
A compliance approach may not encourage decision makers to consider the larger picture and can
oversimplify decision making. ANS -
laws typically follow market practices ANS -
Laws are also subject to interpretation and compliance by market participants, who may choose to
interpret the law in the most advantageous way possible or delay compliance until a later date. ANS -
Identify: Relevant facts, stakeholders and duties owed, ethical principles, conflicts of interest ANS -
Consider: Situational influences, additional guidance, alternative actions ANS -
Decide and act ANS -
Reflect. Was the outcome as anticipated? ANS -
It is helpful to distinguish between facts and personal opinion, judgements, and biases. You will also
want to identify the stakeholders—clients, family, colleagues, your employer, market participants, and
so forth—and the duties you have to each of them. ANS -
in 1992, CFA Institute added the standard addressing performance presentation to the existing list of
standards. ANS -
The comprehensive review of the Code and Standards in 2005 resulted in principle requirements that
remain applicable today. The review carried out for the eleventh edition focused on market practices
that have evolved since the tenth edition ANS -
the eleventh edition includes an update to the Code of Ethics that embraces the members' role of
maintaining the social contract between the industry and investors. ANS -
, Updated vision:
To lead the investment profession globally by promoting the highest standards of ethics, education, and
professional excellence for the ultimate benefit of society. ANS -
One of the bullets in the Code of Ethics was updated to reflect the role that the capital markets have in
the greater society.
Old:
Promote the integrity of and uphold the rules governing capital markets.
New:
Promote the integrity and viability of the global capital markets for the ultimate benefit of society. ANS
-
New Standard Regarding Responsibilities of Supervisors [IV(C)] ANS -The updated version stresses
broader compliance expectations, which include the detection and prevention aspects of the original
version.
Additional Requirement under the Standard for Communication with Clients and Prospective Clients
[V(B)] ANS -the standard regarding communicating with clients now includes an implicit requirement to
discuss the risks and limitations of recommendations being made to clients.
Modification to Standard VII(A) ANS -Old:
Conduct as Members and Candidates in the CFA Program
New:
Conduct as Participants in CFA Institute Programs
