Mastery Exam Series 6 UPDATED ACTUAL Questions and CORRECT Answers
If an Open- End Investment Company has a 12b-1 fee,
which of the following are TRUE?
I. These fees are commonly referred to as asset-based
distribution fees.
II. The fund may advertise as a no-load if the 12b-1
charges are kept under .75%
III. The plan may be terminated by a vote of the sharehold-
ers, the board of directors, or the non interested members A
of the board.
IV. To Terminate 12b-1 fees, a majority of the non inter-
ested board members of a majority vote of outstanding
shares is needed.
A. I and IV
B. II and III
C. I and III
D. II and IV
Which of the following are provisions of the Securities
Exchange Act of 1934?
I. Regulates the sale of new issues of securities
II. Regulates secondary markets
B
III. Regulates investment advisers
IV. Registers Broker/dealers
A. I and III
, B. III and IV
C. I and II
D. II and IV
The declaration of dividend for holders of common stock
in a corporation will result in payment of a dividend to
holders of that corporation's:
I. Convertible Preferred Stock
II. Noncumulative Preferred Stock
III. Outstanding Warrants D
IV. Debentures
A. II and III
B. III and IV
C. I and IV
D. I and II
All of the following are generally considered speculative
investments EXCEPT: (Got this wrong)
A. Uncovered Call Options D
B. B Rated Debt Securities
C. Short Sales
D. Blue- Chip Stocks
A husband and a wife open a new account as TIC. All of
the following statements regarding this account are true
EXCEPT:
A. Mail may be sent to either party with the permission of B
the other party
B. In the event of death, the decedent's interest in the
account goes to the surviving party
, C. Orders may be given by either party
D. If certificates are requested, they must contain the
names of both parties.
Which of the following constitutes selling dividends?
(WRONG)
A. Encouraging investors to postpone purchases of mutual
fund shares until the after the ex-date for a dividend
distribution
B. Encouraging customers to sell their mutual fund shares D
just before the ex-dividend date
C. Withdrawing dividends, rather than reinvesting them in
additional shares
D. Enticing customers to buy mutual fund shares just
before the ex-dividend date
ABC broker/dealer must file which of the following with
FINRA?
I. Website
II. Email to prospect reviewing a recommendation for
investment A
III. Radio advertisement
IV. Promotion sent to 50 nonprofit organizations
A. I and III
B. II and IV
, C. I and IV
D. II and III
Which of the following activities might lead a registered
representative with a member firm to suspect a client
might be engaging in illegal practices? (WRONG)
A. The client still chooses to engage in a transaction once
he learns that a currency transaction report will have to be
completed
D
B. The client wires money to unrelated accounts
C. The client complains frequently about what he feels are
overly large commissions
D. The client seems unduly concerned about losses in his
account.
Which of the following would be eligible to open a Keogh
plan?
A. A salaried investment company employee
B. A CPA who operates as a sole proprietorship B
C. The CEO of a publicly traded corporation
D. A group of physicians who have incorporated their
practice together
A FINRA member broker/dealer enters into a selling
agreement with a mutual fund distributor. Under the
terms of that agreement, the member:
If an Open- End Investment Company has a 12b-1 fee,
which of the following are TRUE?
I. These fees are commonly referred to as asset-based
distribution fees.
II. The fund may advertise as a no-load if the 12b-1
charges are kept under .75%
III. The plan may be terminated by a vote of the sharehold-
ers, the board of directors, or the non interested members A
of the board.
IV. To Terminate 12b-1 fees, a majority of the non inter-
ested board members of a majority vote of outstanding
shares is needed.
A. I and IV
B. II and III
C. I and III
D. II and IV
Which of the following are provisions of the Securities
Exchange Act of 1934?
I. Regulates the sale of new issues of securities
II. Regulates secondary markets
B
III. Regulates investment advisers
IV. Registers Broker/dealers
A. I and III
, B. III and IV
C. I and II
D. II and IV
The declaration of dividend for holders of common stock
in a corporation will result in payment of a dividend to
holders of that corporation's:
I. Convertible Preferred Stock
II. Noncumulative Preferred Stock
III. Outstanding Warrants D
IV. Debentures
A. II and III
B. III and IV
C. I and IV
D. I and II
All of the following are generally considered speculative
investments EXCEPT: (Got this wrong)
A. Uncovered Call Options D
B. B Rated Debt Securities
C. Short Sales
D. Blue- Chip Stocks
A husband and a wife open a new account as TIC. All of
the following statements regarding this account are true
EXCEPT:
A. Mail may be sent to either party with the permission of B
the other party
B. In the event of death, the decedent's interest in the
account goes to the surviving party
, C. Orders may be given by either party
D. If certificates are requested, they must contain the
names of both parties.
Which of the following constitutes selling dividends?
(WRONG)
A. Encouraging investors to postpone purchases of mutual
fund shares until the after the ex-date for a dividend
distribution
B. Encouraging customers to sell their mutual fund shares D
just before the ex-dividend date
C. Withdrawing dividends, rather than reinvesting them in
additional shares
D. Enticing customers to buy mutual fund shares just
before the ex-dividend date
ABC broker/dealer must file which of the following with
FINRA?
I. Website
II. Email to prospect reviewing a recommendation for
investment A
III. Radio advertisement
IV. Promotion sent to 50 nonprofit organizations
A. I and III
B. II and IV
, C. I and IV
D. II and III
Which of the following activities might lead a registered
representative with a member firm to suspect a client
might be engaging in illegal practices? (WRONG)
A. The client still chooses to engage in a transaction once
he learns that a currency transaction report will have to be
completed
D
B. The client wires money to unrelated accounts
C. The client complains frequently about what he feels are
overly large commissions
D. The client seems unduly concerned about losses in his
account.
Which of the following would be eligible to open a Keogh
plan?
A. A salaried investment company employee
B. A CPA who operates as a sole proprietorship B
C. The CEO of a publicly traded corporation
D. A group of physicians who have incorporated their
practice together
A FINRA member broker/dealer enters into a selling
agreement with a mutual fund distributor. Under the
terms of that agreement, the member:
