Answer: Action 2 only

## Explanation Under the CFA Institute's Standard I(A): Knowledge of the Law, members are **not** required to acquire detailed knowledge of all laws relating to their activities (Action 1). Instead, they must: 1. **Understand and comply with applicable laws, rules, and regulations** - but not necessarily have detailed knowledge of all laws 2. **Dissociate from any illegal or unethical activity** (Action 2) 3. **Make reasonable efforts to determine the applicable laws and regulations** 4. **Seek legal advice when uncertain** **Key points:** - **Action 1 is incorrect**: The standard does not require "detailed knowledge of all the laws" - this would be impractical. Members must understand and comply with applicable laws, but they can seek legal advice when needed. - **Action 2 is correct**: Members must dissociate from activities they believe are unethical or illegal. This includes reporting violations to appropriate authorities when required. **Correct answer: B (Action 2 only)** **Additional context:** - The standard emphasizes understanding the spirit and intent of laws, not just memorizing them - Members should establish compliance procedures and maintain records - When in doubt, members should consult their compliance department or legal counsel

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