Redemption 9

Question 1

When a customer does not choose a tax method, IRS chooses _____

Answer 1

FIFO

Question 2

Index options are delivered in ___ and are delivered the next day

Answer 2

Cash

Question 3

Treasury strips have a locked in _____

Answer 3

Yield

Question 4

Price spread is _____

Answer 4

Vertical

Question 5

Calendar spread is _____

Answer 5

Horizontal

Question 6

You can make withdrawals at any time in _____

Answer 6

Roth IRA’s

Question 7

A confirmation sent to a customer must list the amount of any commission, whether the member acted as agent or principal, their markup or markdown, but not the ____ of the registered rep

Answer 7

Name

Question 8

What is not under governance of of the MSRB?

Answer 8

Issuers of muni’s

Question 9

Spread is difference between bid and asked prices

Answer 9

True

Question 10

When it comes to ad valorem and mills, taxes are paid at ____ value, not ______

Answer 10

Assessed, market

Question 11

To determine winning bid on a net interest cost (NIC) basis, an issuer will do which of the following? ______ any premium from total interest cost and ____ any discount to total interest cost

Answer 11

Subtract, add

Question 12

Putting money in a passive investment does NOT need to be reported as _____

Answer 12

Outside business activity

Question 13

529’s must be rolled over within ___ days to avoid taxes

Answer 13

60

Question 14

Ratio of pledged revenues to debt service would be used to analyze ____ bonds

Answer 14

Hospital

Question 15

Insider trading can result in civil fine to the firm the greater of ____ dollars or treble (3) the amount gained or lost

Answer 15

1 million

Question 16

In joint tenants with rights of survivorship, all people have ____ access to the account

Answer 16

Full

Question 17

EPS equation

Answer 17

Net income- preferred shareholder dividends/ share of common stock outstanding

Question 18

Insider trading is only when someone else ____ on the info

Answer 18

trades

Question 19

What position can be taken to hedge a 2x leveraged ETF

Answer 19

Purchase 1 put option on the ETF

Question 20

If disabled and using IRA money to pay fir medical or living expenses, the distribution is subject solely to ____ tax, not ___ tax

Answer 20

Regular income tax, penalty

Question 21

Insider trading can also result in a company having a max fine of ____ million

Answer 21

25

Question 22

In the case of JTWROS and a divorce is happening, you should not follow the persons orders and contact the firm’s ____ department to put a ____ restriction on the account

Answer 22

Legal, withdrawal

Question 23

Convertible preferred stockholders benefit as the market price of the common stock ____

Answer 23

Rises

Question 24

If a claim of damage is less than ____ for an individual and lesss than ____ for a firm, it does not need a file claimed with FINRA

Answer 24

15,000
25,000

Question 25

Are government securities traded over the counter?

Answer 25

Yes

Question 26

If someone is given the order and time but not the size or how many to buy, can they place the order?

Answer 26

No

Question 27

Registered reps _____ trade securities but they can enter orders on behalf of customers to be executed by _____ in the market

Answer 27

Cannot, traders

Question 28

Non essential use Private purpose munis are subject to federal tax. This includes building such as a _____

Answer 28

Convention center

Question 29

Traditional IRA’s are subject to ____

Answer 29

Contribution deadlines

Question 30

Filing of form 144 required when seeking restricted stock is the responsibility of the ____

Answer 30

Seller

Question 31

Which CMO Tranche is most subject to interest rate risk?

Answer 31

Z tranche

Question 32

You can sell a DPP but it must conform to the FINRA ______

Answer 32

5% Policy

Question 33

You CANNOT give money to a campaign of a candidate in the city your firm is in because it is considered _____

Answer 33

Pay to play

Question 34

Transfer on Death accounts are only good for ____ accounts, not _____

Answer 34

Individual, joint

Question 35

An investor who pays $950,000 for TBills with a 5% yield will receive his much when the T Bills mature?

Answer 35

$1,000,000 950,000 /.95=1,000,000

Question 36

Contract multiplier of a index option is ___

Answer 36

100

Question 37

A registered rep takes an order from a customer and then the rep fails to note the execution price on the ticket- what happens?

Answer 37

The order will be returned to the rep for entry of the execution price

Question 38

Transfer on Dearh accounts are typically used for what kind of example: ______

Answer 38

Elderly father and adult son

Question 39

For profit organizations do not offer ____ plans because they are meant for non profit organizations

Answer 39

403B

Question 40

Interval funds redeem its shares at _____

Answer 40

Stated intervals

Question 41

FINRA _____ rule means that you must have/collect the essential facts necessary to effectively service an account before it can be open

Answer 41

KYC

Question 42

Issuers that wish to give “earnings guidance” to research analysts must confirm with the provisions of SEC Reg________

Answer 42

SP

Question 43

Primary function of the market maker is to buy and sell the security in which the market is made into and out of, the firms own account

Answer 43

True

Question 44

The 3 part test for whether a soft-dollar transaction is permissible includes

Answer 44

Eligibility of service lawful assistance Reasonableness of commissions (amount paid must be reasonable)

Question 45

Switching out recent activity trades with other companies that are comparable is a violation and is called _____

Answer 45

Stock switching

Question 46

A saucer is a ____ trend

Answer 46

Reverse downward

Question 47

Nominal yield is equivalent to the percentage of par value received by the bondholder _____

Answer 47

Annually

Question 48

You’d buy an ADR if you expect the US$ will be ____

Answer 48

Weaker

Question 49

The ____ shows the total amount of debt of the company because it shows assets and liabilities

Answer 49

Balance sheet

Question 50

For JTWROS accounts, if someone gets a divorce, the assets will be divided how?

Answer 50

50% 50% because both people have equal right to assets in the account

Question 51

Original issue- Market discount of premium-

Answer 51

Must be May be

Question 52

Reg SP can’t disclose

Answer 52

The name of 3rd parties with whom the customer info can be shared

Question 53

For variable annuities- the _____ of a minimum growth rate in the separate account if a higher annual fee is paid for this rider

Answer 53

Guarantee

Question 54

Unqualified legal opinion states that no ____ have been found against pledged revenues

Answer 54

Liens

Question 55

If you leave the firm and want to return in the next five years, you have to complete the ____ element and ______ ANNUALLY

Answer 55

Regulatory, Practical

Question 56

If a customer buys a fully paid security enrolled in DTC’s DRS System, the customer will receive a _______

Answer 56

Statement of ownership

Question 57

An executed order ticket must contain (BANTTOP)

Answer 57

B-Buy or sell A- Account number N- Number of shares T- Time of execution T- Time of order entry O- Order type (market, limit, stop, stop limit) P- Execution price

Question 58

Muni debt, corporate debt, and listed options settle ___

Answer 58

T+1

Question 59

Access equals delivery means that a prospectus can be delivered ____ in lieu of ____ if the member firm knows the customer has _____ access

Answer 59

Electronic, paper, internet

Question 60

A mutual fund has a NAV of $11.00. What is the max offering per share?

Answer 60

12.02 $11/ (100-8.85)=$12.02

Question 61

Muni advertising must be kept by the firm for ___ years

Answer 61

4

Question 62

Foreign exchange rates are set in the ____ market

Answer 62

Interbank

Question 63

MORE than 25 is considered ____ communication

Answer 63

Retail

Question 64

Trust indenture is a contract between the ____ and the ____

Answer 64

Issuer, trustee

Question 65

Copies of municipal advertising ____ have to be sent to the MSRB before first use

Answer 65

DOES NOT

Question 66

Which preferred stock has the greatest price volatility when interest rates are stable?

Answer 66

Participating preferred

Question 67

Stock sold through Reg A is very ___ because it allows companies to raise capital through public offerings of securities that can be sold to the general public

Answer 67

Liquid

Question 68

Middle of the road annuity payout that is not too long or too short

Answer 68

Life with period certain

Question 69

Balanced funds have ___ risk because they have bonds and stocks and expose to volatility

Answer 69

Moderate

Question 70

Equity index funds are a bit ____ because it’s provides growth, but is not predictable. It is not appropriate for a _____ member

Answer 70

Volatile, conservative

Question 71

When, as if, issued occurs WITHOUT knowing the _____ date

Answer 71

Settlement

Question 72

In JTIC, do both parties have to be listed on what is made payable?

Answer 72

Yes

Question 73

Serial bonds have _____

Answer 73

Balloon maturity

Question 74

To efficiently hedges broadly diversified stock portfolio, you should purchase ______

Answer 74

S&P Options Contracts

Question 75

Exchange listed ADR’s are ____

Answer 75

Sponsored

Question 76

Premium on a listed option is quoted 4 3/4. What’s the customer pay for this option?

Answer 76

475.00 Listed options contracts cover 100 shares

Question 77

Are growth funds long term or short term?

Answer 77

Long term

Question 78

Corporate bond is typically quoted as a percentage of ____ value

Answer 78

Par

Question 79

Capital gains from muni’s are subject to what kind of tax?

Answer 79

Federal, state, local

Question 80

Difference between defeasement and refunding is that defeasement sets money aside to pay debt and refunding issues new bonds

Answer 80

True

Question 81

Three reasonable basis suitability obligations to use to determine customer recommendations includes?

Answer 81

Customer specific suitability Quantitative suitability Reasonable basis suitability

Question 82

The individual responsible for the overall supervision if all of a firm’s options activities on behalf of it’s customers must be the _______

Answer 82

Registered Options Principal

Question 83

Target date funds shut from ____ concentration to ______

Answer 83

Equity, fixed income Growth to conservation

Question 84

Uncovered ____ carry unlimited risk

Answer 84

Short calls

Question 85

The premium paid to buy the ____ costs less than the margin required to sell the stock short

Answer 85

Put

Question 86

For options Income- Protect-

Answer 86

Income- sell Protect- buy

Question 87

Best way to hedge a short put is to have a ____

Answer 87

Long put

Question 88

Most common retail options position is a ____

Answer 88

Covered call

Question 89

When options are exercised, you are ____ the _____ amount

Answer 89

Credited, in the money

Question 90

Covered calls increase ______

Answer 90

rate of return

Question 91

Purchasing a ___ effects the holding period of a stock

Answer 91

Put

Question 92

Short straddles are _____

Answer 92

Neutral

Question 93

FINRA Rule 2330 refers to ____

Answer 93

Deferred Variable Annuities

Question 94

2330 once determined suitable by the rep must have principal approval when-

Answer 94

Before sending the application to the insurance company

Question 95

Customer confirmation? (CAM)

Answer 95

Control relationship Agent or principal Market maker?