Exam Wrong Answers 2

Question 1

Who obtains the CUSIP for a municipal bond issue?

Answer 1

The underwriter

Question 2

Which of the following transactions requires distribution of an offering circular to prospective investors?

Answer 2

Ref A+

Question 3

Which of the following best describes cash settlement?

Answer 3

The customer pays for the securities on trade date

Question 4

An investor owns 1000 shares of ABC, a biotechnology company that is still in the early stages of testing a new drug. The price of the stock dropped recently, but the investor believes that the drug the company is developing will be a blockbuster. Which of the following strategies would end able the investor to increase the overall return on his portfolio during this time?

Answer 4

Write 10 ABC calls

Question 5

Companies are required to notify FINRA of corporate actions, such as dividends, stock splits, or reverse stock splits, and rights or subscription offerings within what time period?

Answer 5

10 days prior to the record date

Question 6

All of the following are types of new stock underwriting except

Answer 6

Not held

Question 7

An investor can be granted an extension of time by

Answer 7

FINRA and the transacting exchange

Question 8

The term for active stock that represents the number of shares owned by the public is

Answer 8

Outstanding stock

Question 9

According to FINRA rules, members are required to report any violations of laws, rules and regulations within how many days?

Answer 9

30 days

Question 10

For an individual who is not covered by an employer sponsored plan, IRA contributions are

Answer 10

Fully tax deductible

Question 11

All of the following are characteristics of an exchange traded fund (ETF) except

Answer 11

ETFs sell directly to investors

Question 12

Publications reporting total return data for an investment should use the recommended reporting period of

Answer 12

1 year, 5 years and the lesser of 10 years or life of the investment

Question 13

Which of the following joint accounts is designed specifically for married couples?

Answer 13

Tenancy by the Entirety

Question 14

If a member firm suspects that a senior customer (age 65 or older) is being financially exploited, it may

Answer 14

Place a temporary hold on disbursements from the customer’s account

Question 15

When a customer account is approved for options, within how many days must the customer return a signed options disclosure document?

Answer 15

15 days

Question 16

Annuity contracts have a number of important features. Which of the following accurately describes an annuity contract?

Answer 16

The type of annuity selected partly determines the payment amounts to the annuitant

Question 17

Which of the following statements about the balance of payments is true?

Answer 17

It is the sum of all transactions between a country and the rest of the world over a specified period of time

Question 18

According to industry regulations, when an investor makes an initial purchase of $2,500 in a new margin account, he is required to make a cash deposit of

Answer 18

$2,000

Question 19

A mutual fund that charges the maximum sales charge of 8 1/2% allowable by the investment company act of 1940 does not have to offer

Answer 19

Exchange rights