SIE EXAM PRACTICE QUESTIONS 1,
WITH 100% CORRECT ANSWER.
Under FINRA rules, noncash compensation connected with the sale of variable contracts
include all of the following items except:
correct answer- Commissions
When selling a fixed amount of a base currency to purchase a counter currency, which of the
following factors is primarily used to determine how much of the counter currency the
customer will recieve?
correct answer- The spot exchange rate
Which of the following security types provides investors with a stated maturitity date, a floating
interest rate, and an option to put the security back to a financial intermediary on a daily or
weekly basis?
correct answer- Variable rate demand note
A Registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take?
correct answer- Send written notice to his supervisor outlining the activity and compensation
structure.
At issue, which of the following debt securities mature in one year or less?
correct answer- Money market instruments
The computation of dollar prices and accrued interest on municipal bonds is normally on what
calendar basis?
correct answer- 30/360
Which of the following best describes the essential difference between a primary distribution
and a secondary distribution?
correct answer- A Primary distribution involves a sale of newly issued shares by the issuer while
a secondary distribution involves the sale of already issued and outstanding shares.
In a period of low inflation and economic recession, the federal reserve is expected to take
which of the following actions?
correct answer- buy bonds in the open market.
, Which of the following investment risks is the greatest risk in a variable life insurance policy?
correct answer- Market risk
Which of the following considerations should a registered representative explain to a customer
when recommending a 529 college savings plan?
correct answer- The potential deductibility of contributions from state taxes.
Which of the following form U4 re-portable events results in a statutory disqualification?
correct answer- A Felony conviction for driving under the influence (DUI) charge.
The owner of which of the following products is most exposed to inflationary risks?
correct answer- treasury bonds
A firm is a participant in a public offering. To sell a substantial amount of the securities to its
customers, the firm agrees to repurchase the shares at no less than the original sales price.
Such agreements are:
correct answer- Prohibited as fraudulent and manipulative.
Blue-sky laws are regulated by which of the following entities?
correct answer- State securities regulators.
Under FINRA rules, which of the following activities by a registered representative requires
written notification to her firm?
correct answer- Driving part time for a transportation network company on weekends.
Which of the following investments are generally traded according to their average life rather
than their stated maturity dates?
correct answer- Asset-backed securities
Stability in the value of a debt portfolio is greatest when?
correct answer- Maturities of the debt securities are short.
Under industry regulations, an initial purchase of $3,000 of common stock in a margin account
requires a cash deposit of:
correct answer- $2,000
Which of the floowing statements is true about all U.S government agency issues?
correct answer- They are exempt from registration under the Securities Act of 1933.
Under the Securities ACT of 1933, registration is required for which of the following securities?
correct answer- American Depository Receipts (ADRs)
Direct participation programs (DPPs) provide:
correct answer- Exposure to non-correlated assets with steady returns.
Which of the following stakeholders has first claim priority in a chapter 11 proceeding?
correct answer- Security debt holders
2
WITH 100% CORRECT ANSWER.
Under FINRA rules, noncash compensation connected with the sale of variable contracts
include all of the following items except:
correct answer- Commissions
When selling a fixed amount of a base currency to purchase a counter currency, which of the
following factors is primarily used to determine how much of the counter currency the
customer will recieve?
correct answer- The spot exchange rate
Which of the following security types provides investors with a stated maturitity date, a floating
interest rate, and an option to put the security back to a financial intermediary on a daily or
weekly basis?
correct answer- Variable rate demand note
A Registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take?
correct answer- Send written notice to his supervisor outlining the activity and compensation
structure.
At issue, which of the following debt securities mature in one year or less?
correct answer- Money market instruments
The computation of dollar prices and accrued interest on municipal bonds is normally on what
calendar basis?
correct answer- 30/360
Which of the following best describes the essential difference between a primary distribution
and a secondary distribution?
correct answer- A Primary distribution involves a sale of newly issued shares by the issuer while
a secondary distribution involves the sale of already issued and outstanding shares.
In a period of low inflation and economic recession, the federal reserve is expected to take
which of the following actions?
correct answer- buy bonds in the open market.
, Which of the following investment risks is the greatest risk in a variable life insurance policy?
correct answer- Market risk
Which of the following considerations should a registered representative explain to a customer
when recommending a 529 college savings plan?
correct answer- The potential deductibility of contributions from state taxes.
Which of the following form U4 re-portable events results in a statutory disqualification?
correct answer- A Felony conviction for driving under the influence (DUI) charge.
The owner of which of the following products is most exposed to inflationary risks?
correct answer- treasury bonds
A firm is a participant in a public offering. To sell a substantial amount of the securities to its
customers, the firm agrees to repurchase the shares at no less than the original sales price.
Such agreements are:
correct answer- Prohibited as fraudulent and manipulative.
Blue-sky laws are regulated by which of the following entities?
correct answer- State securities regulators.
Under FINRA rules, which of the following activities by a registered representative requires
written notification to her firm?
correct answer- Driving part time for a transportation network company on weekends.
Which of the following investments are generally traded according to their average life rather
than their stated maturity dates?
correct answer- Asset-backed securities
Stability in the value of a debt portfolio is greatest when?
correct answer- Maturities of the debt securities are short.
Under industry regulations, an initial purchase of $3,000 of common stock in a margin account
requires a cash deposit of:
correct answer- $2,000
Which of the floowing statements is true about all U.S government agency issues?
correct answer- They are exempt from registration under the Securities Act of 1933.
Under the Securities ACT of 1933, registration is required for which of the following securities?
correct answer- American Depository Receipts (ADRs)
Direct participation programs (DPPs) provide:
correct answer- Exposure to non-correlated assets with steady returns.
Which of the following stakeholders has first claim priority in a chapter 11 proceeding?
correct answer- Security debt holders
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