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Completing the CFA exam is one of the final hurdles to earning a Chartered Financial Analyst (CFA) designation. The exam, which consists of three parts, is designed to test your knowledge of financial analysis and it’s generally recommended that advisors dedicate a minimum of 300 hours to exam prep. Completing CFA sample questions can offer insight on what to expect when you’re ready to sit for the exam.
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CFA Exam Sample Questions
Sample questions for the CFA exam are readily available online from a number of sources. Questions span core knowledge areas covered by exam Levels I, II, and III. The following CFA sample questions are drawn from multiple sources, including Kaplan Schweser, UWorld and the CFA Institute.
After completing the questions, scroll to the bottom for the answer key. You’ll also find links to the source each question was drawn from.
Level I Sample Questions
Question 1 (Source: Kaplan Schweser)
Darth Corporation’s net income was $1,200 in the most recent period. Its depreciation expense was $800 and its accounts receivable increased by $1,000. Based only on this information, cash flow from operating activities reported by Darth should be:
A. $2,200
B. $1,200
C. $1,000
Question 2 (Source: UWorld)
According to the Modigliani-Miller propositions (with taxes), if a company increases its debt level, its market value will most likely:
A. Decrease since the costs of financial distress are increasing.
B. Remain the same since the market value is unaffected by the capital structure.
C. Increase proportionally to the change in debt.
Question 3 (Source: CFA Institute)
Which of the following statements is most accurate? Ethics can be described as:
A. A commitment to upholding the law.
B. An individual’s personal opinion about right and wrong.
C. A set of moral principles that provide guidance for our behavior.
Question 4 (Source: Kaplan Schweser)
Aggressive accounting choices by management are most likely to:
A. Produce decision-useful financial reporting.
B. Report sustainable earnings.
C. Comply with generally accepted accounting principles.
Question 5 (Source: UWorld)
In the short run, a company maximizing profit in a market with perfect competition produces at a quantity that most likely results in:
A. Economic profits equal to zero.
B. Marginal revenue equal to marginal cost.
C. Market price greater than marginal revenue.
Question 6 (Source: CFA Institute)
A company has total variable costs of USD $4 million and fixed costs of USD $3 million. Based on this information, the company will stay in the market in the long term if total revenue is at least:
A. $3 million
B. $4.5 million
C. $7 million
Level II CFA Sample Questions
Question 7 (Source: Kaplan Schweser)
The adjustments to a company’s financial statements to capitalize an operating lease will MOST LIKELY result in:
A. Increased financial leverage and debt-to-equity ratios.
B. Higher EBIT, as long as depreciation expense is greater than rent expense.
C. A decrease in interest expense, causing an increase in the interest coverage ratio.
Question 8 (Source: UWorld)
Tom Johnson, CFA, is a portfolio manager at Universal Advisors, a US-based wealth management firm that serves high-net-worth individuals and families. Universal’s equity portfolio offering includes separately managed accounts (SMAs) in which clients own individual securities. Johnson manages the portfolio with an aggressive high-risk, high-reward strategy, investing mostly in small-cap growth stocks. To reduce transaction costs and to simplify trading and settlement, Universal buys only US-listed securities for client accounts.
Johnson instructs Francois Martin, a CFA Level II candidate and new equity analyst at the firm, to conduct research on Vent Industries, a French wind turbine manufacturer. Vent is dually listed on exchanges in France and in the US. Martin, a French national who recently moved to the US, is already familiar with the company since he has been following it personally for the past two years.
After completing due diligence on Vent, Martin is thoroughly impressed by the investment prospects and suggests that Johnson add the US-listed shares of Vent to client portfolios. Johnson, as the sole decision-maker, reviews Martin’s research and financial models but wants to think about the suggestion before reaching a conclusion.
Martin is so impressed with Vent’s investment prospects that he wants to buy it for his personal account. For guidance, Martin references Universal’s publicly available personal transaction disclosure, which states only the following:
“Investment personnel are subject to policies and procedures regarding their personal trading.”
Needing more details, Martin checks with the firm’s compliance officer, who informs him that the firm does have policies and procedures designed to prevent potential conflicts of interest related to personal trading. Universal does not require that employees obtain preclearance before trading, but the firm’s policies do require:
- a two-day blackout period before and after client trades, and
- a quarterly report by its investment decision-making personnel on transactions and holdings.
Based on this information, Martin immediately places an order to buy Vent shares listed in France through his personal French brokerage account, which he established prior to joining Universal. Three days later, Johnson decides to invest for clients in the US-listed shares of Vent and places the order through Universal’s trading desk.
Johnson is a board member for a local hospital endowment; for this, he receives modest compensation. Universal has approved Johnson’s board participation and compensation. Johnson is considered to be a thoughtful and successful investor. The other board members, unhappy with the fees and performance of the endowment’s existing income-oriented large-cap equity manager, asked Johnson a year ago if he would be willing to manage the equity portion of the endowment. Johnson responded by stating:
“The hospital provides so much to this community, I would be happy to manage the endowment’s equity portfolio. It won’t even take much time; I will manage the endowment portfolio as an exact replica of Universal’s equity portfolio.”
The next month, without informing Universal, Johnson began managing the endowment portfolio as a mirror image of Universal’s equity strategy.
Recently, Johnson evaluated the investment prospects of an upcoming IPO for a small-cap biotech firm. The company does innovative cancer research, but it is still years away from profitability. After conducting thorough due diligence, Johnson has concluded this is a great investment opportunity; he would like the hospital endowment to participate, believing the other board members would be excited about the company’s cancer research.
Johnson speaks to Universal’s lead underwriter and requests that 5% of the firm’s IPO allotment be allocated to the endowment. A few days later, when the IPO is priced and allocated, Universal receives 95,000 shares and the endowment receives 5,000 shares.
Do Universal’s personal transaction disclosure policies comply with CFA Institute’s required and recommended procedures?
A. No
B. Yes, since no disclosure is required.
C. Yes, since they meet the minimum disclosure requirements.
Level III CFA Sample Questions
Question 9 (Source: Kaplan Schweser)
To execute a domestic carry trade when there is a stable downward sloping yield curve, which of the following strategies is most appropriate?
A. Borrow at lower longer-term rates to invest at higher shorter-term rates.
B. Borrow at lower shorter-term rates to invest at higher longer-term rates.
C. Borrow at lower medium-term rates to invest at higher shorter-term or longer-term rates.
Question 10 (Source: UWorld)
Franco Rienzi manages a eurozone equity and fixed-income fund for a Zurich-based asset management company. Rienzi is meeting with Crista Vogel, an analyst working for the firm. Rienzi asks Vogel to evaluate long-run sustainable real GDP growth rates for European countries. Rienzi suggests that Vogel use historical growth rates from 1980 to the present. The two discuss the usefulness of historical data going that far back. During the discussion, Vogel makes the following statements:
| Statement 1: | Using data from 1980 to the present is appropriate since this time horizon includes multiple business cycles. This makes for a better estimate of long-run average GDP growth, which can then be used as a proxy for an economy’s sustainable growth rate. |
| Statement 2: | Since most economic data series are rebased periodically, when multiple data sources are used it is essential to be certain that data calculated from different base periods are not being mixed. |
Rienzi and Vogel then discuss the state of the economy for individual eurozone countries. Part of the discussion addresses the long-run impacts of different mixes of tight and loose monetary and fiscal policy. Eventually, the conversation turns to negative interest rates, and Rienzi makes the following comments:
| Comment 1: | Negative policy rates result in very low or negative interest rates on cash equivalents, intended to stimulate growth through increased consumer spending by reducing returns on savings, and by encouraging businesses to increase investments since more projects are profitable at the lower rate. |
| Comment 2: | Reliable capital market forecasts can be made using models derived from analyzing the statistics on asset returns, interest rates, and GDP growth rates from around the globe for the numerous historical periods of negative rates. |
Returning to the topic of sustainable economic growth, Rienzi asks Vogel about economic models that estimate growth based on labor, capital, and technology. Vogel notes that increases in labor productivity are closely tied to real GDP growth rates, and she then identifies the key contributors to improvements in productivity.
Which of Vogel’s statements is most likely correct?
A. Only Statement 1
B. Only Statement 2
C. Both Statement 1 and 2
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CFA Test Sample Question Answer Key
| Answer | Explanation |
|---|---|
| Question 1: C | Adjustments to reconcile net income to cash flow from operating activities will require that depreciation ($800) be added back, and the increase in accounts receivable ($1,000) be subtracted: $1,200 + 800 – 1,000 = $1,000. |
| Question 2: C | The Modigliani-Miller propositions assume perfect capital markets (i.e., no arbitrage, no transaction or bankruptcy costs, and symmetric information). When these propositions include corporate taxes, greater leverage will increase a company’s market value and reduce its weighted average cost of capital. |
| Question 3: C | Ethics can be described as a set of moral principles that provide guidance for our behavior; these may be moral principles shared by a community or societal group. |
| Question 4: C | Management may follow generally accepted accounting principles and still make biased accounting choices, which diminish the decision-usefulness of financial reporting. Aggressive accounting choices are those that increase earnings, revenues, or operating cash flows in the current period (and likely reduce them in later periods). |
| Question 5: B | Under perfect competition, a firm maximizes short-run economic profit by producing and selling at the quantity where marginal revenue (MR) equals marginal cost (MC). Since there is perfectly elastic demand, price also equals MR for all quantities. Short-run, but not long-run, economic profits are possible. However, a firm may earn an accounting profit even if economic profits are zero or negative. |
| Question 6: C | A company will stay in the market in the long term if total revenue is equal to or greater than total cost. Because total costs are $7 million, the company will stay in the market in the long term if total revenue equals at least $7 million. |
| Question 7: A | The financial leverage ratio is calculated as assets divided by equity, and with a large increase in assets, this will increase the financial leverage ratio. |
| Question 8: A | Standard VI(B) Priority of Transactions stipulates that once a firm has established a policy on personal investing, specific reporting of personal holdings and securities transactions of investment personnel is required to ensure the policy is enforced. Since the policy’s overriding goal is to address client concerns regarding personal securities transactions and any conflicts of interest for the firm’s employees, enforcement procedures must also be established. |
| Question 9: A | A carry trade is a form of leverage. In a stable downward-sloping curve, rates are falling as time/term increases. Therefore, an appropriate strategy would be to borrow at lower longer- term rates to invest at higher shorter-term rates. |
| Question 10: B | Over time, the basis for generating economic data often changes. This rebasing means that data from different sources may be incompatible if not calculated from the same base period. |
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Frequently Asked Questions (FAQs)
What Are the Prerequisites for Taking the CFA Exam?
There are no strict prerequisites for taking the CFA exam, but there are requirements to earn a CFA designation. You must pass all three levels of the exam, complete qualifying work experience, and apply for membership in the CFA Institute. Work experience must involve investment decision-making or similar experience, and you can complete this step before, during, or after participating in the CFA program.
What Is the CFA Exam Pass Rate?
As of 2026, the Level I CFA exam pass rate was 39% across all candidates, and 45% for first-time test takers. The pass rate for Level II was 43%, with a 48% pass rate for first-time candidates. The Level III pass rate was 50% overall, with a 59% rate for those taking the exam for the first time.1
Can You Retake the CFA Exam If You Fail?
You can retake any level of the CFA exam up to six times. Candidates can sit for an exam a maximum of two times per calendar year, and you must wait at least six months between exam attempts. You also have to pay the full registration fee for each retake, which as of September 2026 was $1,490 for Levels I and II, and $1,590 for Level III. Discounted fees are available for early registrants.2
Bottom Line
Earning a CFA designation could help you expand your client base or move your advisory business in a new direction. Completing CFA test sample questions is just one part of a comprehensive study plan. If you’re considering a third-party test prep curriculum, weigh the course format along with the cost, as well as how long you’ll have access to the materials.
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- Is a CFA designation worth it? It could be if you’re interested in working with clients whose needs include deep financial analysis. You might consider a different credential, such as a Certified Financial Planner™ (CFP®) certification if you’re more interested in offering holistic advice to clients. CFP® requirements include a comprehensive exam, a bachelor’s degree, relevant work experience and a commitment to the CFB Board’s code of ethics.
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Article Sources
All articles are reviewed and updated by SmartAsset’s fact-checkers for accuracy. Visit our Editorial Policy for more details on our overall journalistic standards.
- CFA Program candidate exam results. CFAInstitute.org. 4 Sept 2026, https://www.cfainstitute.org/sites/default/files/docs/programs/cfa-program/candidate-resources/cfa-exam-results-pass-rate-infographic.pdf.
- CFA Exam Dates and Fees. CFAInstitute.org. 4 Sept 2026, https://www.cfainstitute.org/programs/cfa-program/dates-fees#how-much-does-the-cfa-program-cost-.