CFA Level I Sample Questions 2026: Free Practice Questions with Answers

CFA Level I Sample Questions 2026 are valuable resources for you in preparing for the upcoming examination. They help learners understand the question format, review important concepts, and test their knowledge across the CFA syllabus.

Practising free questions with answers also allows you to identify weak areas, improve accuracy, and develop better time-management skills. Since these questions reflect the style and difficulty of actual exam items, regular practice can strengthen overall preparation. 

You can use the provided sample questions to revise key topics, track your progress, build confidence, and effectively improve your readiness for the CFA Level I Exam 2026. 

CFA Level I Questions and Answers

The CFA Level I exam covers various topics. Understanding question types is crucial. Here are examples of CFA exam sample questions from key areas. They show how to approach different problems.

Ethical and Professional Standards Question

1. Ethics is best described as:

A. Following all laws.

B. A person's own ideas of right and wrong.

C. Moral principles guiding behavior.

 Answer: C is correct. Ethics refers to a set of moral principles. These guide behavior, often shared by a community or group.

Quantitative Methods Question

2. An investor bought 100 shares at 30.50 per share. What is the holding period return?

A. −13.0 percent

B. −11.6 percent

C. −10.1 percent

 Answer: C is correct.

 Applying Equation 2, the holding period return is −10.1 percent, calculated as follows:

R = (3,050 − 3,450 + 51.55)/3,450 = −10.1%. The holding period return comprises a dividend yield of 1.49 percent  (=51.55/3,450) and a capital loss of −11.59 percent (= −400/3,450).

Financial Statement Analysis Question

3. Sublyme Corp. reported 5 dividend and converts to two common shares. What is the diluted EPS?

 A. USD3.52

B. USD3.65

C. USD3.70

 Answer: C is correct.

 Diluted EPS = (Net income)/(Weighted average number of shares outstanding + New common shares that would have been issued at conversion)= USD200,000,000/[50,000,000 + (2,000,000 × 2)] = USD3.70

The diluted EPS assumes that the preferred dividend is not paid and that the shares are converted at the beginning of the period.

4. A company has total variable costs of USD4 million and fixed costs of USD3 million. Based on this information, the company will stay in the market in the long term if total revenue is at least:

A. USD3.0 million
B. USD4.5 million
C. USD7.0 million

C is correct. 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 USD7 million (USD4 million variable costs and USD3 million fixed costs), the company will stay in the market in the long term if total revenue equals at least USD7 million. 

5. Which of the following statements about exchange-traded funds is most correct?

A. Exchange-traded funds are not backed by any assets
B. The investment companies that create exchange-traded funds are financial intermediaries
C. The transaction costs of trading shares of exchange-traded funds are substantially greater than the combined costs of trading the underlying assets of the fund

B is correct. The investment companies that create exchange-traded funds (ETFs) are financial intermediaries. ETFs are securities that represent ownership in the assets held by the fund. The transaction costs of trading shares of ETFs are substantially lower than the combined costs of trading the underlying assets of the ETF. 

6. Assume that today (t = 0) the current US five-year Treasury note trades at a price equal to the bond’s face value of USD50,000,000. The security buyer takes delivery of the US Treasury note today and pays the security seller USD50,000,000. Assume a repo term of 45 days (and 360 days in a year) and a repo rate of 0.375%. If the buyer agrees to return the five-year Treasury note 45 days from today (t = T) to the seller, the repurchase price is closest to:

A. USD50,015,625
B. USD50,023,438
C. USD50,187,500

Ans. B is correct. USD 50,023,438 is calculated as:

USD 50,000,000 × [1 + (0.375% × 45/360)] = USD 50,023,438.

In effect, the security seller borrows USD 50,000,000 on a short-term basis at a low cost, with interest (USD 23,438) paid at maturity, because the loan is collateralized by the US Treasury note.

A is incorrect because a repo term of 30 days, as opposed to 45 days, is incorrectly used:

USD 50,000,000 × [1 + (0.375% × 30/360)] = USD 50,015,625.

C is incorrect because the repo term and number of days in a year are not used:

USD 50,000,000 × (1 + 0.375%) = USD50,187,500.

Benefits of CFA Level I Practice Questions

CFA Level I practice questions help you strengthen your understanding of key concepts and prepare more effectively for the exam. Regular practice builds familiarity with the question format, improves accuracy, and helps you evaluate your preparation before the 2026 exam.

• Helps you understand the CFA Level I exam pattern

• Strengthens knowledge of core syllabus concepts

• Identifies weak topics that require more revision

• Improves speed, accuracy, and time management

• Provides practice with exam-style multiple-choice questions

• Helps you apply concepts to practical situations

• Reduces exam anxiety through regular practice

• Builds confidence before attempting the actual examination

• Allows you to track your preparation progress

• Supports effective revision and better retention of concepts