CFA Level II Vignettes Ethics Standards Conflicts Interest MCQs Test 1

Practice CFA 2026 Level II Vignettes Ethics Standards MCQs from Conflicts Interest. Get instant results with Explanation.

Practice Quiz 1 for "Conflicts Interest" (Ethics Standards). Total 30 MCQs available, split into 3 quizzes. Start with the fundamentals and build a strong base. Mastering these concepts is essential for securing a high percentile in CFA.

General10 MCQs

1. Vignette 1: ConflictAware Advisors - Sarah Thompson, CFA, recommends a hedge fund to her clients. Thompson owns a 10% stake in the hedge fund. She does not disclose this ownership to her clients. Has Thompson violated the Standards?

A. Acceptable because Thompson believes the fund is a good investmentB. Unacceptable because Thompson failed to disclose the conflict of interest under Standard VI(A)C. Acceptable if the fund has a good track recordD. Unacceptable only if the fund underperforms

2. Thompson receives a 2% commission from a fund manager for every client she refers. Thompson does not disclose this commission to her clients. Which Standard has Thompson violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard III(C) - SuitabilityC. Standard IV(A) - Loyalty to EmployerD. Standard VI(A) - Disclosure of Conflicts

3. Thompson recommends a stock of a company to clients. Thompson's spouse is a senior executive at that company. Thompson does not disclose this relationship. Which Standard has Thompson violated?

A. Standard VI(A) - Disclosure of ConflictsB. Standard III(A) - Loyalty, Prudence, and CareC. Standard III(C) - SuitabilityD. Standard I(B) - Independence and Objectivity

4. Thompson refers clients to a specific estate attorney and receives referral fees. Thompson does not disclose this arrangement. Which Standard has Thompson violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard III(C) - SuitabilityC. Standard VI(A) - Disclosure of ConflictsD. Standard IV(A) - Loyalty to Employer

5. Thompson serves on the board of directors of a company whose stock she recommends to clients. She does not disclose her board position to clients. Which Standard has Thompson violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard VI(A) - Disclosure of ConflictsC. Standard IV(A) - Loyalty to EmployerD. Standard I(B) - Independence and Objectivity

General10 MCQs

6. Vignette 2: ConflictFree Partners - James Harrison, CFA, works at a firm that pays bonuses based on the volume of proprietary products sold. Harrison recommends these products to clients without disclosing the bonus structure. Has Harrison violated the Standards?

A. Acceptable because the firm discloses the overall fee structure to all clientsB. Acceptable if the clients have signed the engagement letterC. Unacceptable because the specific compensation arrangement is a material conflict requiring disclosure under Standard VI(A)D. Unacceptable only if the conflict leads to poor performance

7. Harrison recommends a private company's stock to clients. Harrison owns a significant stake in the company. He does not disclose this ownership. Which Standard has Harrison violated?

A. Standard VI(A) - Disclosure of ConflictsB. Standard III(A) - Loyalty, Prudence, and CareC. Standard IV(A) - Loyalty to EmployerD. Standard I(B) - Independence and Objectivity

8. Harrison refers clients to an insurance company and receives commissions. He does not disclose these commissions. Which Standard has Harrison violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard III(C) - SuitabilityC. Standard IV(A) - Loyalty to EmployerD. Standard VI(A) - Disclosure of Conflicts

9. Harrison recommends a bond issue to clients. Harrison's brother is the underwriter for the issue and will earn a fee. Harrison does not disclose this relationship. Which Standard has Harrison violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard VI(A) - Disclosure of ConflictsC. Standard III(C) - SuitabilityD. Standard I(B) - Independence and Objectivity

10. Harrison accepts an all-expenses-paid trip to a conference from a fund manager whose products he recommends. Harrison does not disclose this gift. Which Standard has Harrison violated?

A. Standard III(A) - Loyalty, Prudence, and CareB. Standard IV(A) - Loyalty to EmployerC. Standard VI(A) - Disclosure of ConflictsD. Standard I(B) - Independence and Objectivity

📋 CFA - Test Online Practice Quizzes

CFA

Conducting Body: CFA Institute

Frequency: 4 times a year (February, May, August, November) | Time: 70 Minutes

Negative Marking: No

⚡ Test Pattern (Total: 90 MCQs):

Subject breakdown not available.

Merit Formula: -

Practice CFA MCQs

CFA FLP 1 CFA FLP 2 CFA FLP 3

CFA Level II Vignettes Ethics Standards Conflicts Interest MCQs Test 1

📋 CFA - Test Online Practice Quizzes

CFA

Quick Links

Latest Admissions

International Scholarships

Popular Medical Colleges

Popular Universities

CFA Free Quizzes

CFA Quick Quiz

International Scholarships