Missed Questions Flashcards
Which term refers to an existing public corporation issuing a large block of new shared to expand or modernize?
Primary Distribution
A trade financial services company, which provides institutional trade processing, clearing, and settlement services, is:
The Depository Trust & Clearing Corporation (DTCC)
What type of offering is not required to register with the U.S. Securities and Exchange Commission?
Intrastate Offering
This offering is made to investors in only one state, and is exempt from SEC registration:
Intrastate offering
Who has the greatest risk exposure in an underwriting?
Syndicate
Which of the following are subsets of the Nasdaq system?
Global Market & Capital Market
XYZ Corporation is an issuer that sells book-entry securities. Which entity is responsible for maintaining a list of ownership?
Transfer agent
When the Securities and Exchange Commission has reviewed a prospectus, it means the SEC has:
Checked the prospectus for required information
True or False: All government and municipal debt securities are sold in the OTC market.
True
True or False: a 529 Savings plan is considered a municipal offering?
True
How must stock certificates be delivered?
In multiples of 100 when possible.
True or false: For an issuer to qualify for an exemption under Rule 147, they must have 80% of their employees based within that state?
False
How many days is the quiet period restriction following an IPO for any member participating in the offering?
10 Days
When can a firm accept payment for a new issue on a customer order?
When registration is effective
ABC Inc. was incorporated in 2014 and had its initial public offering in 2017. In its most recent filing, ABC provided the following information at the close of its fiscal year:
Gross income: $15,500,000
Net income: $4,285,000
Number of shares outstanding:10,000,000
Price per share: $8.50
Value of tangible assets: $3,380,000
Value of intangible assets: $485,000
Outstanding loan balance:$1,150,000
Accounts payable: $290,000
Based on this information, what is ABC Inc.’s book value?
Tangible Assets - Liab = $1,940,000
FRK Corporation issued convertible preferred stock with a par of $100. The shares are convertible at $25, when the current market price of the common stock is $20. What is the conversion ratio?
4:1
Shares sold to the public are considered:
Issued
What type of security requires the delivery of a program disclosure document?
Municipal fund securities, including 529 savings plans.
General Microsystem’s 9% bonds mature in 10 years and are trading at 92. What is the approximate yield to maturity?
(Par - current price/ years to maturity)+annual interest /(average of current price and par) or (($1000-920)/10) + 90) / 1000+920/2 = 10.2%
A registered representative has spent most of the day discussing a large potential mutual fund purchase with an elderly couple in their early 80s wanting to invest $200,000 that they received from the sale of their home. The RR advised the couple to spread their investment out among 6 different fund families in order to obtain maximum diversification. What potential violation of FINRA’s conduct rules may have occurred?
The RR may have committed a breakpoint sales violation
Which type of company does not reinvest portfolio earnings for its shareholders, but instead distributes the proceeds of any securities that are liquidated or mature?
Unit investment trust
Which of the following is not a factor when determining the initial payment upon annuitization of an annuity contract?
Annuitant’s health
LGIPs that are offered by broker-dealers are:
Investment pools available to local government entities that permit investment of public funds
True or False: A decrease in the level of PPI is a signal of inflation?
False
True or False: Regarding elasticity, all products and services will have a change in demand when their prices change
False
What measures the value of all finished goods and services produced by a country’s citizens, regardless of where they reside?
GNP
Which statement is false regarding a tenants in common account?
Neither tenant can devise or gift their interest
True or False: Regarding Defined benefit plans - The greatest benefit will be for employees with a high salary and who are nearing retirement
True - The payout amount is usually based on the employees highest years of salary, years of experience and age.
What type of client account compensates the investment adviser or sponsor with a flat fee for their advisory and order execution services?
Wrap account
A cash account with a broker is one in which:
The cash for a transaction must be deposited within 2 days of settlement
Information about an associated person which is available to the public upon request through the FINRA BrokerCheck program does not include?
Information about the person’s education
The following monetary related securities dispute is exempt from being handled through the arbitration process:
Dispute between a registered representative and their employing firm regarding employment discrimination
All the following transactions would require that a Currency Transaction Report be filed, except a
Check deposit of $20,000 into the account at the firm
A brokerage firm has been informed by FINRA that it must create and implement an anti-money laundering program that conforms to the PATRIOT Act and industry interpretations. Which of the following is required of the firm?
Establish an independent audit testing for compliance to be conducted by member personnel or a qualified outside party
Which of the following statements best describes structuring?
Depositing or withdrawing cash to/from an account in amounts just below the reporting requirement
