- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 1. Rates and Returns
- Subject 4. Annualized Return
CFA Practice Question
Annualized returns ______
II. assume that money can be re-invested repeatedly while earning a similar return.
III. cannot be calculated when the holding period return is more than 10 years.
I. allow for comparison among different assets and over different time periods.
II. assume that money can be re-invested repeatedly while earning a similar return.
III. cannot be calculated when the holding period return is more than 10 years.
A. I, II and III
B. I and II
C. II and III
Explanation: II. One implicit assumption of annualizing return is that returns can be repeated precisely.
III. Yes, they can be calculated.
III. Yes, they can be calculated.
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