Practice Test 6

Question 1

Initial reg T margin market deposit requirement is

Answer 1

At least 50% of the market value of the transaction by T+3

Question 2

If a customer complains in writing about a municipal purchase, the MSRB requires that it is attempted to be resolved but needs to be reviewed by the __

Answer 2

Principal

Question 3

Income statement, balance sheet, and retained earnings capital are all included on the ___ report

Answer 3

10K

Question 4

A purchaser of a reg D private placement must complete and sign an _____

Answer 4

Accredited investor questionnaire

Question 5

______ is when a member firm gives officers of public companies IPO allocations in return for receiving underwriting business

Answer 5

Spinning

Question 6

Variable annuities are sold with a prospectus because they are ____

Answer 6

Non exempt

Question 7

All dividends, interest and Capital gains are tax deferred in the separate account during the _____ phase

Answer 7

Accumulation phase

Question 8

Reg U controls credit from ____ to ____

Answer 8

Bank to broker

Question 9

True or False: Even if you don’t believe something is suitable, if the client pushes you, you should execute and notate it on the file

Answer 9

True

Question 10

On ex dividend dated orders placed ______ the current market are reduced for ____ dividends

Answer 10

Below, Cash

Question 11

____ and public offering price are synonymous and bid and ____ are the same terms

Answer 11

Ask, Redemption

Question 12

Minimum price at which a _____ fund can be purchased is market price ____ a commission

Answer 12

Closed end, Plus

Question 13

Flow of funds applies to municipal ___bonds

Answer 13

Revenue

Question 14

Municipal revenue one trust indenture includes an additional bonds test covenant that prohibits the issuing of

Answer 14

Parity bonds and Senior lien bonds

Question 15

Sinking fund is where monies meet the debt service requirements and are ___

Answer 15

Deposited

Question 16

Costs to be paid by the issuer are NOT included in a municipal bond ____

Answer 16

Resolution

Question 17

Treasury receipts pay interest ____

Answer 17

At maturity

Question 18

Yields of convertible bond issues are higher than the yields for similar non convertible issues and when the stock price is at a discount to the conversion price, bond price movements are usually caused by ____ changes

Answer 18

Interest rate

Question 19

When a yield curve is normal, ___ term rates are more volatile than ___ term rates

Answer 19

Short, long

Question 20

Counter cyclical stocks move in the ___ direction of the market

Answer 20

Opposite

Question 21

____ investing is when you pay a lower price for a security based on the expectation that the market is mispricing the issue

Answer 21

Value investing

Question 22

True or false: AA rated revenue bonds that are escrowed to maturity are safe for an individual seeking income that is tax deferred from federal income tax.

Answer 22

True

Question 23

True or False: Passive management uses a performance benchmark such as market index that any investment must match

Answer 23

True

Question 24

____ displays quotes on common and preferred stock, warrants and rights registered in the AnEx, or the NYSE and trading in the OTC Market

Answer 24

CQS- consolidated quotation system

Question 25

Broker dealers adjust open orders for stock splits, ____ dividends, and __ dividends

Answer 25

Cash dividends, Stock

Question 26

LGIPs are considered to be ___ bond securities

Answer 26

Municipal

Question 27

________ plans covering only the top 5% of the highest paid offers are not covered by ____

Answer 27

Deferred compensation, ERISA

Question 28

DPP’s can offset passive __ with passive ___

Answer 28

Income, losses

Question 29

Annuitization does not occur with a variable life policy, but occurs with a ___

Answer 29

Variable contract

Question 30

GMIB’s ar optional rider attached to an annuity contract guaranteeing a _____ level of calculated payments upon annotation

Answer 30

Minimum

Question 31

______ is when you withdraw cash to or from an account in amounts just below federal reporting requirements

Answer 31

Structuring

Question 32

Customer fails to deliver must be bought in ___ days after ____

Answer 32

10, settlement date

Question 33

Quotes placed by market participants in UNLINKED ECN’s can be accessed through ____

Answer 33

ADF (alternate display facility)

Question 34

A fundamental analyst can use technical analysis to determine _____ timing

Answer 34

Transaction timing

Question 35

_________ plan requires that the same aggregate dollar amount be kept INVESTED in ____

Answer 35

Constant dollar investment, Equities

Question 36

Reinvested dividends and capital gains of mutual funds __ the basis

Answer 36

Increase

Question 37

If interest rates fall, issuers will most likely call _____ trading at a premium

Answer 37

Preferred stock

Question 38

Property taxes pay ____ bonds

Answer 38

GO

Question 39

Member firms must send their customers an account statement how often?

Answer 39

Quarterly