CFA Practice Question

There are 434 practice questions for this study session.

CFA Practice Question

A mutual fund manager wants to create a fund based on a high-grade corporate bond index. She first distinguishes between utility bonds and industrial bonds; she then, for each segment, defines maturity intervals of less than 5 years, 5 to 10 years, and greater than 10 years. For each segment and maturity level, she classifies the bonds as callable or non-callable. She then selects bonds from each of the subpopulations she has created. For the manager's sample, which of the following best describes the sampling approach?
A. systematic
B. simple random
C. stratified random
Explanation: In stratified random sampling, one divides the sample into sub-populations and randomly samples from within the subpopulations.

User Contributed Comments 2

User Comment
tomalot "She then SELECTS bonds from each of the subpopulations..." This doesn't seem random!
1a2a Agreed with tomalot. I selected A but then just figured this was another one of those dumb misworded questions. Changed to C and oh look I got it right?

I shouldn't have to fight against the question bank in order to succeed on this exam. It's already difficult enough as it is.
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