Greenlight Exam 2 2024 | Greenlight Actual
Exam Latest Update 2024 Questions and
Correct Answers Rated A+
Three basis points are equal to:
A) 3%
B) 3/10th of 1%
C) 3/100th of 1%
D) 3/1000th of 1% - ANSWER-C) 3/100th of 1%
One basis point is equal to .01%, or 1/100th of 1%. Therefore, three basis
points equals .03%, or 3/100th of 1%.
What is the required annual income for a married couple to be considered
an accredited investor under Regulation D?
A) $100,000
B) $300,000
C) $1 million
D) $5 million - ANSWER-B) $300,000
To be considered accredited, the required annual income for a married
couple is $300,000 in each of the last two years, with the expectation that
this level will continue. For a individual investor, the required annual income
is $200,000
Regarding exchange-traded options, all of the following are TRUE
statements, EXCEPT:
A) The number of shares per contract is standardized.
B) There are position limits that are imposed on clients.
C) They are settled on the next business day (T + 1).
,D) They are settled on the second business day (T + 2). - ANSWER-D)
They are settled on the second business day (T + 2).
Since the question is in reference to options trading, all of the statements
are true except that they settle on the second business day (T + 2). Option
trades settle on the next business day (T + 1). However, if the question
asked about the exercise of an option, the resulting stock transaction
settles on the second business day (T + 2).
An investor notices a specific stock is trading at a higher price on one
exchange than on another. If the investor takes advantage of this
difference, it's referred to as:
A) Front running
B) Arbitrage
C) Insider trading
D) Trading ahead - ANSWER-B) Arbitrage
Simultaneously buying and selling a security on different exchanges in
order to take advantage of a price difference is referred to as arbitrage.
Front running, insider trading, and trading ahead are all prohibited
activities.
Broker-dealers must provide a privacy notice to every consumer:
A) When the account is opened
B) When the first trade occurs
C) Before disclosing nonpublic, personal information
D) If requested - ANSWER-C) Before disclosing nonpublic, personal
information
A consumer is someone who provides information to a firm in connection
with a potential transaction but is not yet a customer. The rules differ for
customers and consumers. A consumer need only be provided with a
privacy notice before disclosing nonpublic, personal information to a non-
,affiliated third party. If the firm does not intend to provide this information to
a non-affiliated third party, it does not need to provide the consumer with its
privacy notice.
Deposits of cash that are held at a bank are insured by which of the
following?
A) The Federal Deposit Insurance Corporation (FDIC)
B) The Internal Revenue Service (IRS)
C) The Securities Investors Protection Corporation (SIPC)
D) The Securities Exchange Commission (SEC) - ANSWER-A) The
Federal Deposit Insurance Corporation (FDIC)
The Federal Deposit Insurance Corporation is an independent agency that
was created by the Congress. The FDIC's role is to maintain stability and
public confidence in the nation's financial system. The FDIC insures
banking deposits and examines financial institutions for both safety and
soundness. The current FDIC insurance coverage limit is $250,000 per
depositor, per FDIC-insured bank
Prior to the maturity of a variable-rate demand obligation, an investor has
the right to receive the:
A) Current market value
B) Par value
C) Par value plus accrued interest
D) Par value less accrued interest - ANSWER-C) Par value plus accrued
interest
A variable-rate demand obligation (VRDO) can be redeemed prior to
maturity on any date the interest rate on the obligation is reset. Rates can
be reset on a monthly, weekly, or daily basis. The obligation will be
redeemed at par value plus accrued interest.
, The Founders Income Fund has declared a dividend that is payable to
stockholders of record on Thursday, May 29. This mutual fund's ex-
dividend will typically be on:
A) Monday, May 26
B) Tuesday, May 27
C) Wednesday, May 28
D) The date that is set by the fund or its principal underwriter (sponsor) -
ANSWER-D) The date that is set by the fund or its principal underwriter
(sponsor)
Mutual fund shares do not trade on exchanges and do not have a fixed
settlement date. For this reason, the ex-dividend date for a mutual fund will
not automatically be one day before the record date, as it is for common
stock. Instead, a mutual fund's ex-dividend date is on a date that is
determined by the fund or its principal underwriter (sponsor). In practice,
mutual funds will often use the day after the record date as the ex-dividend
date.
Federal and state registration requirements apply to all of the following,
EXCEPT:
A) Publicly traded limited partnerships
B) Preferred stock
C) Municipal securities
D) Open-end investment companies - ANSWER-C) Municipal securities
Municipal and U.S. government securities are exempt from the registration
requirements of the Securities Act of 1933 and from state registration
requirements.
The BG mutual fund has a NAV of $11.72 and an offering price of $12.67.
What is the sales charge for this fund?
A) 7.5%
Exam Latest Update 2024 Questions and
Correct Answers Rated A+
Three basis points are equal to:
A) 3%
B) 3/10th of 1%
C) 3/100th of 1%
D) 3/1000th of 1% - ANSWER-C) 3/100th of 1%
One basis point is equal to .01%, or 1/100th of 1%. Therefore, three basis
points equals .03%, or 3/100th of 1%.
What is the required annual income for a married couple to be considered
an accredited investor under Regulation D?
A) $100,000
B) $300,000
C) $1 million
D) $5 million - ANSWER-B) $300,000
To be considered accredited, the required annual income for a married
couple is $300,000 in each of the last two years, with the expectation that
this level will continue. For a individual investor, the required annual income
is $200,000
Regarding exchange-traded options, all of the following are TRUE
statements, EXCEPT:
A) The number of shares per contract is standardized.
B) There are position limits that are imposed on clients.
C) They are settled on the next business day (T + 1).
,D) They are settled on the second business day (T + 2). - ANSWER-D)
They are settled on the second business day (T + 2).
Since the question is in reference to options trading, all of the statements
are true except that they settle on the second business day (T + 2). Option
trades settle on the next business day (T + 1). However, if the question
asked about the exercise of an option, the resulting stock transaction
settles on the second business day (T + 2).
An investor notices a specific stock is trading at a higher price on one
exchange than on another. If the investor takes advantage of this
difference, it's referred to as:
A) Front running
B) Arbitrage
C) Insider trading
D) Trading ahead - ANSWER-B) Arbitrage
Simultaneously buying and selling a security on different exchanges in
order to take advantage of a price difference is referred to as arbitrage.
Front running, insider trading, and trading ahead are all prohibited
activities.
Broker-dealers must provide a privacy notice to every consumer:
A) When the account is opened
B) When the first trade occurs
C) Before disclosing nonpublic, personal information
D) If requested - ANSWER-C) Before disclosing nonpublic, personal
information
A consumer is someone who provides information to a firm in connection
with a potential transaction but is not yet a customer. The rules differ for
customers and consumers. A consumer need only be provided with a
privacy notice before disclosing nonpublic, personal information to a non-
,affiliated third party. If the firm does not intend to provide this information to
a non-affiliated third party, it does not need to provide the consumer with its
privacy notice.
Deposits of cash that are held at a bank are insured by which of the
following?
A) The Federal Deposit Insurance Corporation (FDIC)
B) The Internal Revenue Service (IRS)
C) The Securities Investors Protection Corporation (SIPC)
D) The Securities Exchange Commission (SEC) - ANSWER-A) The
Federal Deposit Insurance Corporation (FDIC)
The Federal Deposit Insurance Corporation is an independent agency that
was created by the Congress. The FDIC's role is to maintain stability and
public confidence in the nation's financial system. The FDIC insures
banking deposits and examines financial institutions for both safety and
soundness. The current FDIC insurance coverage limit is $250,000 per
depositor, per FDIC-insured bank
Prior to the maturity of a variable-rate demand obligation, an investor has
the right to receive the:
A) Current market value
B) Par value
C) Par value plus accrued interest
D) Par value less accrued interest - ANSWER-C) Par value plus accrued
interest
A variable-rate demand obligation (VRDO) can be redeemed prior to
maturity on any date the interest rate on the obligation is reset. Rates can
be reset on a monthly, weekly, or daily basis. The obligation will be
redeemed at par value plus accrued interest.
, The Founders Income Fund has declared a dividend that is payable to
stockholders of record on Thursday, May 29. This mutual fund's ex-
dividend will typically be on:
A) Monday, May 26
B) Tuesday, May 27
C) Wednesday, May 28
D) The date that is set by the fund or its principal underwriter (sponsor) -
ANSWER-D) The date that is set by the fund or its principal underwriter
(sponsor)
Mutual fund shares do not trade on exchanges and do not have a fixed
settlement date. For this reason, the ex-dividend date for a mutual fund will
not automatically be one day before the record date, as it is for common
stock. Instead, a mutual fund's ex-dividend date is on a date that is
determined by the fund or its principal underwriter (sponsor). In practice,
mutual funds will often use the day after the record date as the ex-dividend
date.
Federal and state registration requirements apply to all of the following,
EXCEPT:
A) Publicly traded limited partnerships
B) Preferred stock
C) Municipal securities
D) Open-end investment companies - ANSWER-C) Municipal securities
Municipal and U.S. government securities are exempt from the registration
requirements of the Securities Act of 1933 and from state registration
requirements.
The BG mutual fund has a NAV of $11.72 and an offering price of $12.67.
What is the sales charge for this fund?
A) 7.5%
