FINRA SIE Exam Latest Update 2025/2026|
Real-Based Questions with Verified Answers|
Guaranteed Perfect Score 100%
A corporate bond which is backed solely by full faith and credit of the issuer.. - Correct
Answers-Debenture
A corporation has issued 9%, $1,000 par convertible debenture which convert at $50. The
common stock is currently trading at $60. If the bond and the common stock are trading at
parity a customer purchasing 5M of the bonds will pay: - Correct Answers-Answer $6,000.
The bonds are convertible at $50, based on a $1,000 par value therefore each bond convert into
20 shares at $50. If the common stock is trading at $60 the bond must be trading at $60 x 20 =
$1,200
Since they are buying 5M that means that are paying 5 x $1,200 = $6,000
A corporation has issued bonds at 8%. Three years later similar issues are being offered in the
primary market at 7% which of the following statements will be true about the current yield and
the nominal yield? - Correct Answers-The current yield will be lower than the nominal yield.
The dollar price of the bond will be at a premium.
Nominal (stated) = .08
Market price of bond = .08/.07 = 1,143
Current Yield = = .06999
A corporation issued a 7% AA sinking fund debenture at par. Three years later, similar issues are
being issues at 8%. Which of the following is true about the outstanding 7% issue? How does
the current yield relate to the nominal yield - Correct Answers-The current yield will be
higher than the nominal yield.
,The nominal yield (stated yield) will be 7%
The market price of the yield will drop when the new issues are at a higher yield.
Current yield = annual interest $/ current market price
market price = .07 / .08 = 875
Current yield =
Current yield = .08
Current yield > Nominal
A customer owns 256 shares of ABC common stock. ABC declares a rights offering, with the
terms being that for every 15 rights a shareholder may purchase one additional share.at $24 a
share. Any fractional rights may be rounded up to buy an additional share.
How many shares may the customer buy with these right? - Correct Answers-A share holder
can buy a maximum of 18 shares with these rights paying $432 for them.
The 17.06 shares may be rounded up to 18.
A customer places an to buy bonds. The order reads
"Buy 5M ABC 9s M'35 @ 90 GTC"
At which of the following will the price be executed
I 89
, II 90
III 91
IV 92 - Correct Answers-I and II
The order is a Limit Buy so the purchase will only be initiated at or below 90
A middle age woman widowed customer has an investment objective of stable income and
wants minimal market and liquidity risk. What type of preferred stock would be the best
recommendation
I Participating
II Convertible
III Straight Preferred Stock
IV Variable rate preferred - Correct Answers-IV Variable Rate preferred
A municipality wishes to sell a bond issue that is NOT backed by taxing power. Which of the
following bonds can be issued?
I Revenue Bond
II Industrial Revenue Bond
III General obligation Bond
IV Lease rental bond - Correct Answers-I , II, and IV
Real-Based Questions with Verified Answers|
Guaranteed Perfect Score 100%
A corporate bond which is backed solely by full faith and credit of the issuer.. - Correct
Answers-Debenture
A corporation has issued 9%, $1,000 par convertible debenture which convert at $50. The
common stock is currently trading at $60. If the bond and the common stock are trading at
parity a customer purchasing 5M of the bonds will pay: - Correct Answers-Answer $6,000.
The bonds are convertible at $50, based on a $1,000 par value therefore each bond convert into
20 shares at $50. If the common stock is trading at $60 the bond must be trading at $60 x 20 =
$1,200
Since they are buying 5M that means that are paying 5 x $1,200 = $6,000
A corporation has issued bonds at 8%. Three years later similar issues are being offered in the
primary market at 7% which of the following statements will be true about the current yield and
the nominal yield? - Correct Answers-The current yield will be lower than the nominal yield.
The dollar price of the bond will be at a premium.
Nominal (stated) = .08
Market price of bond = .08/.07 = 1,143
Current Yield = = .06999
A corporation issued a 7% AA sinking fund debenture at par. Three years later, similar issues are
being issues at 8%. Which of the following is true about the outstanding 7% issue? How does
the current yield relate to the nominal yield - Correct Answers-The current yield will be
higher than the nominal yield.
,The nominal yield (stated yield) will be 7%
The market price of the yield will drop when the new issues are at a higher yield.
Current yield = annual interest $/ current market price
market price = .07 / .08 = 875
Current yield =
Current yield = .08
Current yield > Nominal
A customer owns 256 shares of ABC common stock. ABC declares a rights offering, with the
terms being that for every 15 rights a shareholder may purchase one additional share.at $24 a
share. Any fractional rights may be rounded up to buy an additional share.
How many shares may the customer buy with these right? - Correct Answers-A share holder
can buy a maximum of 18 shares with these rights paying $432 for them.
The 17.06 shares may be rounded up to 18.
A customer places an to buy bonds. The order reads
"Buy 5M ABC 9s M'35 @ 90 GTC"
At which of the following will the price be executed
I 89
, II 90
III 91
IV 92 - Correct Answers-I and II
The order is a Limit Buy so the purchase will only be initiated at or below 90
A middle age woman widowed customer has an investment objective of stable income and
wants minimal market and liquidity risk. What type of preferred stock would be the best
recommendation
I Participating
II Convertible
III Straight Preferred Stock
IV Variable rate preferred - Correct Answers-IV Variable Rate preferred
A municipality wishes to sell a bond issue that is NOT backed by taxing power. Which of the
following bonds can be issued?
I Revenue Bond
II Industrial Revenue Bond
III General obligation Bond
IV Lease rental bond - Correct Answers-I , II, and IV
