FINRA SIE UPDATED EXAM SCRIPT QUESTIONS AND
SOLUTIONS RATED A+
✔✔Which of the following are defined as investment companies under the Investment
Company Act of 1940 - ✔✔1) Management Company
2) Unit Investment Trust
3) Face Amount Certificate Company
( Real Estate Investment Trust are not considered under this act)
✔✔Constitutional Debt Limits are imposed on the issuance of? - ✔✔General Obligation
bonds
(Moral obligation bonds are not subject to debt limits they are issued in desperation)
✔✔Which of the following pay dividends?
I Warrants
II ADR's
III Preferred Stocks
IV Real Estate Investment Trust Shares - ✔✔II , III , IV
Warrants are the only ones that do not pay dividends
✔✔Which rights do shareholders in a management company have?
I Vote for the Board of Directors
II Vote for the investment adviser of the fund
III Receive semi-annual and annual reports
IV Choose the broker who executes the portfolio transactions - ✔✔They have the
following rights
(Voting for BOD, Voting for the adviser, Receive reports)
✔✔Trust indenture of a Bond contains the following information? - ✔✔Interest Rate
Maturity
Collateral backing the issue
, Call Provisions
✔✔Which of the following statements are TRUE about tax shelters about tax shelters
that invest in raw land? - ✔✔Tax shelters for Raw land are NOT Allowed
The main reason to invest in Raw land would be appreciation potential
✔✔Sell Limit Orders?
I Used to sell at prices that are lower than current market prices
II Used to sell at prices that are higher than the current market price
III Guarantees a specific price
IV Does not guarantee a specific price - ✔✔II and III
Sell above the current market price Guarantees a specific price
(These securities can only be filled at the current market price or higher - so they do
guarantee a specific price or better)
✔✔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 - ✔✔I , II, and IV
Only General obligation bonds are required by taxing power. The rest are revenue
backed
✔✔Stockholder approval is needed if a corporation wishes to do which of the following?
I Split it's stock 1 for 2
II Split its stock 2 for 1
III Repurchases shares for it's Treasury
IV Issue convertible securities - ✔✔I II and IV
SOLUTIONS RATED A+
✔✔Which of the following are defined as investment companies under the Investment
Company Act of 1940 - ✔✔1) Management Company
2) Unit Investment Trust
3) Face Amount Certificate Company
( Real Estate Investment Trust are not considered under this act)
✔✔Constitutional Debt Limits are imposed on the issuance of? - ✔✔General Obligation
bonds
(Moral obligation bonds are not subject to debt limits they are issued in desperation)
✔✔Which of the following pay dividends?
I Warrants
II ADR's
III Preferred Stocks
IV Real Estate Investment Trust Shares - ✔✔II , III , IV
Warrants are the only ones that do not pay dividends
✔✔Which rights do shareholders in a management company have?
I Vote for the Board of Directors
II Vote for the investment adviser of the fund
III Receive semi-annual and annual reports
IV Choose the broker who executes the portfolio transactions - ✔✔They have the
following rights
(Voting for BOD, Voting for the adviser, Receive reports)
✔✔Trust indenture of a Bond contains the following information? - ✔✔Interest Rate
Maturity
Collateral backing the issue
, Call Provisions
✔✔Which of the following statements are TRUE about tax shelters about tax shelters
that invest in raw land? - ✔✔Tax shelters for Raw land are NOT Allowed
The main reason to invest in Raw land would be appreciation potential
✔✔Sell Limit Orders?
I Used to sell at prices that are lower than current market prices
II Used to sell at prices that are higher than the current market price
III Guarantees a specific price
IV Does not guarantee a specific price - ✔✔II and III
Sell above the current market price Guarantees a specific price
(These securities can only be filled at the current market price or higher - so they do
guarantee a specific price or better)
✔✔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 - ✔✔I , II, and IV
Only General obligation bonds are required by taxing power. The rest are revenue
backed
✔✔Stockholder approval is needed if a corporation wishes to do which of the following?
I Split it's stock 1 for 2
II Split its stock 2 for 1
III Repurchases shares for it's Treasury
IV Issue convertible securities - ✔✔I II and IV
