- CFA Exams
- CFA Level I Exam
- Study Session 2. Quantitative Methods (1)
- Reading 8. Probability Concepts
- Subject 10. Principles of Counting

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**CFA Practice Question**

A portfolio has 10 stocks. Each stock can be sold or kept in the portfolio. What is the number of possible outcomes?

B. 524

C. 1024

A. 20

B. 524

C. 1024

Correct Answer: C

The number of outcomes is equal to 2

^{10}= 1024.###
**User Contributed Comments**
4

User |
Comment |
---|---|

vincenthuang |
2*2*2*2*2*2*2*2*2*2 |

surob |
Can someone give more detailed explanation? |

AusPhD |
two choices (in or out) for each stock |

viannie |
2 possible outcome for each stock; 10 stocks; therefore number of outcomes from these 10 stocks = 2x2x2 .... (power of 10) stock #1 = 2 outcomes; stock #2 = 2 outcomes etc |