Missed Questions

Question 1

Which term refers to an existing public corporation issuing a large block of new shared to expand or modernize?

Answer 1

Primary Distribution

Question 2

A trade financial services company, which provides institutional trade processing, clearing, and settlement services, is:

Answer 2

The Depository Trust & Clearing Corporation (DTCC)

Question 3

What type of offering is not required to register with the U.S. Securities and Exchange Commission?

Answer 3

Intrastate Offering

Question 4

This offering is made to investors in only one state, and is exempt from SEC registration:

Answer 4

Intrastate offering

Question 5

Who has the greatest risk exposure in an underwriting?

Answer 5

Syndicate

Question 6

Which of the following are subsets of the Nasdaq system?

Answer 6

Global Market & Capital Market

Question 7

XYZ Corporation is an issuer that sells book-entry securities. Which entity is responsible for maintaining a list of ownership?

Answer 7

Transfer agent

Question 8

When the Securities and Exchange Commission has reviewed a prospectus, it means the SEC has:

Answer 8

Checked the prospectus for required information

Question 9

True or False: All government and municipal debt securities are sold in the OTC market.

Answer 9

True

Question 10

True or False: a 529 Savings plan is considered a municipal offering?

Answer 10

True

Question 11

How must stock certificates be delivered?

Answer 11

In multiples of 100 when possible.

Question 12

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?

Answer 12

False

Question 13

How many days is the quiet period restriction following an IPO for any member participating in the offering?

Answer 13

10 Days

Question 14

When can a firm accept payment for a new issue on a customer order?

Answer 14

When registration is effective

Question 15

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?

Answer 15

Tangible Assets - Liab = $1,940,000

Question 16

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?

Answer 16

4:1

Question 17

Shares sold to the public are considered:

Answer 17

Issued

Question 18

What type of security requires the delivery of a program disclosure document?

Answer 18

Municipal fund securities, including 529 savings plans.

Question 19

General Microsystem’s 9% bonds mature in 10 years and are trading at 92. What is the approximate yield to maturity?

Answer 19

(Par - current price/ years to maturity)+annual interest /(average of current price and par) or (($1000-920)/10) + 90) / 1000+920/2 = 10.2%

Question 20

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?

Answer 20

The RR may have committed a breakpoint sales violation

Question 21

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?

Answer 21

Unit investment trust

Question 22

Which of the following is not a factor when determining the initial payment upon annuitization of an annuity contract?

Answer 22

Annuitant’s health

Question 23

LGIPs that are offered by broker-dealers are:

Answer 23

Investment pools available to local government entities that permit investment of public funds

Question 24

True or False: A decrease in the level of PPI is a signal of inflation?

Answer 24

False

Question 25

True or False: Regarding elasticity, all products and services will have a change in demand when their prices change

Answer 25

False

Question 26

What measures the value of all finished goods and services produced by a country’s citizens, regardless of where they reside?

Answer 26

GNP

Question 27

Which statement is false regarding a tenants in common account?

Answer 27

Neither tenant can devise or gift their interest

Question 28

True or False: Regarding Defined benefit plans - The greatest benefit will be for employees with a high salary and who are nearing retirement

Answer 28

True - The payout amount is usually based on the employees highest years of salary, years of experience and age.

Question 29

What type of client account compensates the investment adviser or sponsor with a flat fee for their advisory and order execution services?

Answer 29

Wrap account

Question 30

A cash account with a broker is one in which:

Answer 30

The cash for a transaction must be deposited within 2 days of settlement

Question 31

Information about an associated person which is available to the public upon request through the FINRA BrokerCheck program does not include?

Answer 31

Information about the person’s education

Question 32

The following monetary related securities dispute is exempt from being handled through the arbitration process:

Answer 32

Dispute between a registered representative and their employing firm regarding employment discrimination

Question 33

All the following transactions would require that a Currency Transaction Report be filed, except a

Answer 33

Check deposit of $20,000 into the account at the firm

Question 34

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?

Answer 34

Establish an independent audit testing for compliance to be conducted by member personnel or a qualified outside party

Question 35

Which of the following statements best describes structuring?

Answer 35

Depositing or withdrawing cash to/from an account in amounts just below the reporting requirement