Free CIMA CIMAPRA19-F03-1-ENG Exam Questions

Become CIMA Certified with updated CIMAPRA19-F03-1-ENG exam questions and correct answers

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Total 305 Questions | Updated On: Mar 12, 2026

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Question 1

A company has just received a hostile bid. Which of the following response strategies could be considered?

A : value non-current assets

B : ison pill strategy

C : ange the Articles of Association to amend voting rights

D : proach a White Knight

Answer: D

Question 2

Extracts from a company's profit forecast for the next financial year as follows:

Since preparing the forecast, the company has decided to return surplus cash to shareholders by a share

repurchase arrangement.

The share repurchase would result in the company purchasing 20% of the 1,250 million ordinary shares

currently in issue and canceling them.

Assuming the share repurchase went ahead, the impact on the company's forecast earnings per share will be an

increase of:

A : $0.100

B : $0.125

C : $0.175

D : $0.200

Answer: A

Question 3

A company's current profit before interest and taxation is $1.1 million and it is expected to remain constant for

the foreseeable future.

The company has 4 million shares in issue on which the earnings yield is currently 10%. It also has a $2

million bond in issue with a fixed interest rate of 5%.

The corporate income tax rate is 20% and is expected to remain unchanged.

Which of the following is the best estimate of the current share price?

A : $2.75

B : $2.50

C : $2.00

D : $1.10

Answer: C

Question 4

H Company has a fixed rate load at 10.0%, but wishes to swap to variable. It can borrow at LIBOR 8%.

The bank is currently quoting swap rates of 3.1% (bid) and 3.5% (ask).

What net rate will H Company pay if it enters into the swap?

A : BOR +6.5%

B : BOR +8%

C : BOR +6.9%

D : BOR +3.1%

Answer: C

Question 5

Which THREE of the following statements are correct?

A : portfolio can be diversified by increasing the number of securities in different industries held in the portfolio.

B : tematic risk can be eliminated in a diversified portfolio.

C : beta of a company's shares reflects systematic risk.

D : beta of 1 indicates that the investment is risk free.

E : security market line (SML) shows the relationship between systematic risk and return.

Answer: A,C

Page: 1 / 61

Total 305 Questions | Updated On: Mar 12, 2026

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