SIE PRACTICE TEST V4.

Question 1

Which of the following FORM U4 reportable events results in a statutory disqualification?

Answer 1

A felony conviction for a driving under the influence (DUI) charge

Question 2

Which of the following communications with the public is considered misleading?

Answer 2

Literature providing 10-year performance information to support predictions of future performance

Question 3

Under normal circumstances, a customer’s letter of intent on a mutual fund purchase is valid for what maximum period of time?

Answer 3

13 months

Question 4

At issue, which of the following debts securities mature in one year or less?

Answer 4

Money market instruments

Question 5

Under FINRA rules, which of the following activities by a registered representative requires written notification to her firm?

Answer 5

Driving part time for a transportation network company on weekends

Question 6

Call protection is most valuable to a bond owner when bond prices are generally:

Answer 6

Rising

Question 7

The owner of which of the following is most exposed to inflationary risk?

Answer 7

Treasury bonds

Question 8

Which of the following security types provides investors with a stated maturity date, a floating interest rate, and an option to put the security back to a financial intermediary on a daily or weekly basis?

Answer 8

Variable rate demand note

Question 9

Broker-dealer ABC seeks to underwrite a municipal securities offeritng

Question 10

Under the security Act of 1933, registration is required for which of the following

Answer 10

American Depositary Receipts (ADRs)

Question 11

The call provision of a bond stipulates which of the following factors?

Answer 11

Call date and call price

Question 12

A transaction in which writer covers a position by purchasing an option is called

Answer 12

a closing purchase

Question 13

Stability in the value of a debt portfolio is greatest when:

Answer 13

maturities of the debt securities are short

Question 14

Blue-sky laws are regulated by which of the following entities?

Answer 14

State securities regulators

Question 15

Which of the following considerations should a registered representative explain to a customer when recommending a 529 college saving plan?

Answer 15

The potential deductibility of contributions from state taxes

Question 16

In the event of a stock split, which of the following parties is required to maintain a record of the shareholders eligible to receive the additional shares?

Answer 16

Transfer agent

Question 17

In the event of a stock split, which of the following parties is required to maintain a record of the shareholders eligible to receive the additional shares?

Answer 17

Transfer agent

Question 18

Which of the following stakeholders has first claim priority in a chapter 11 proceeding?

Answer 18

Secured debts holders

Question 19

which of the following statement is true about all U.S government agency issue?

Answer 19

They are exempt from registration under the Securities act of 1933.

Question 20

Upon expiration, all in-the-money S&P 100 Index call options are settled by the delivery of which of the following?

Answer 20

Cash

Question 21

Which of the following outcomes are possible for the write of a covered call option?

Answer 21

Profit limited and loss limited

Question 22

Which of the following actions violates FINRA rules regarding selling away?

Answer 22

Engaging in private securities transactions without written prior consent of the employing BD

Question 23

In a period of low inflation and economic recession, the Federal Reserve is expected to take which of the following?

Answer 23

Buy bonds in the open market

Question 24

Under SEC Regulation S-P (Consumer Privacy), which of the following information must a firm include in its customer privacy and opt-out notices

Answer 24

The policies to protect the security of nonpublic information

Question 25

Which of the following investments are generally traded according to their average life rather than their stated maturity dates

Answer 25

Asset-backed securities

Question 25

Which of the following investments are generally traded according to their average life rather than their stated maturity dates

Answer 25

Asset-backed securities

Question 26

Which of the following products is adversely impacted if the issuer’s credit rating is downgraded?

Answer 26

Exchanged-trade notes (ETNs)

Question 27

The computation of dollar prices and accrued interest on municipal bonds is normally on what calendar basis?

Answer 27

30/360

Question 28

Direct participation programs (DPPs) provide:

Answer 28

Exposure to non-correlated assets with steady returns.

Question 29

Which of the following actions is required of a broker-dealers anti-money laundering (AML) program?

Answer 29

Designating an AML compliance officer

Question 30

Advantage of index fund

Answer 30

Lower management fees due to passive management of the fund

Question 31

Regular way settlement on Treasury bonds is

Answer 31

next business day

Question 31

Regular way settlement on Treasury bonds is

Answer 31

next business day

Question 32

True regarding the concept of an annuity contract

Answer 32

The kind of annuity selected partly determine the payment amounts to the annuitants.

Question 33

The primary purpose of a syndicate desk in context of an equity offering is to

Answer 33

build an order book and allocate stock

Question 33

The primary purpose of a syndicate desk in context of an equity offering is to

Answer 33

build an order book and allocate stock

Question 34

The primary purpose of a syndicate desk in context of an equity offering is to

Answer 34

build an order book and allocate stock

Question 35

No-load mutual funs may have lower expense ratios than load mutual funds for which of the following reasons?

Answer 35

No-load funds are ot permitted to charge a 12b-1 fee greater than 25 basis points.

Question 36

Risky to both foreign and domestics debt instrutments

Answer 36

• political
• repayment
• interest rate