FINRA SIE TEST FINAL EXAM AND PRACTICE
EXAM QUESTIONS WITH COMPLETE EXAM
QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT ANSWERS)
/ALREADY GRADED A+
The redemption value of an open-end investment company's shares is based on the:
previous offering price
previous closing NAV
NAV computed after the order is received
offering price computed after the order is received - ANSWER-NAV computed
after the order is received
The computation of dollar prices and accrued interest on municipal bonds is
normal on what calendar basis?
30/360
30/365
Actual/360
Actual/365 - ANSWER-30/360
Blue-sky laws are regulated by which of the following entities?
SEC
MSRB
FINRA
state securities regulators - ANSWER-State securities regulators
At the time of issuance, which of the following securities normally has the longest
period to expiration?
Rights
Options
Warrants
Repurchase agreements - ANSWER-Warrants
Regular way settlement on Treasury Bonds is:
same day
,next business day
second business day
fifth business day - ANSWER-next business day
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:
prohibited as fraudulent and manipulative.
Permissible if the securities are deposited into escrow.
prohibited unless the firm immediately sets aside funds for the repurchase
permissible if the customers retain the right to sell the securities into the open
market. - ANSWER-prohibited as fraudulent and manipulative
Under SEC S-P (Consumer Privacy), which of the following information must a
firm include in its customer privacy and opt-out notices?
the address of the firm's website
the fee to opt out from the privacy program
the deadline by which to opt out from the privacy program
the policies to protect the security of nonpublic information - ANSWER-the
policies to protect the security of nonpublic information
UTMA accounts are opened under the tax ID number of the:
minor
donor
parent
custodian - ANSWER-minor
Under FINRA rules, noncash compensation connected with the sale of variable
contracts includes all of the following items EXCEPT:
gifts
meals
lodging
commissions - ANSWER-commissions
Describe the difference between primary distribution and secondary distribution. -
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
If a market maker posts a quotes of 10.00 - 10.10 (25x10), which of the following
actions is the market maker willing to take?
sell 1,000 shares at $10 and buy 2,500 shares at $10.10
buy 2,500 shares at $10 and sell 1,000 shares at $10.10
sell 100 shares at $10 and buy 250 shares at $10.10
buy 250 shares at $10 and sell 100 shares at $10.10 - ANSWER-buy 2,500 shares
at $10 and sell 1,000 shares at $10.10
All of the following risks apply to both foreign and domestic debt instruments
EXCEPT:
political
exchange
repayment
interest rate - ANSWER-exchange
A married couple who earned income that exceeded $300k in each of the prior two
years and reasonably expects the same for this current year is:
a qualified investor
an accredited investor
an institutional investor
a qualified institutional buyer - ANSWER-an accredited investor
The owner of which of the following products is MOST exposed to inflationary
risks?
utility stocks
treasury bills
treasury bonds
blue chip industrials - ANSWER-treasury bonds
What is the concept of an annuity contract? - ANSWER-the kind of annuity
selected partly determines the payment amounts to the annuitant
Which of the following statement is true about all US Gov agency issues?
they are exempt from federal taxes
, they are exempt from registration under the Securities Act of 1933
they are issued in bearer form only
they are general obligations of the fed gov - ANSWER-they are exempt from
registration under the Securities Act of 1933
Direct participation programs (DPP's) provide:
liquidity and transparency
exposure to non-correlated assets with steady returns
market-related correlations with higher average returns
investors with direct purchases of stock from public companies - ANSWER-
exposure to non-correlated assets with steady returns
Which of the following outcomes are possible for the writer of a covered call
option?
profit limited and loss limited
profit limited and loss unlimited
profit unlimited and loss limited
profit unlimited and loss unlimited - ANSWER-profit limited and loss limited
when is interest on treasury notes paid?
quarterly
semiannually
annually
at maturity - ANSWER-semiannually
an associated person who is not a registered representative is permitted to engage
in which of the following activities?
accept an unsolicited customer order
provide account opening forms to a new customer
discuss the attributes of a particular investment product
prequalify prospective customers as to investment objectives - ANSWER-provide
account opening forms to a new customer
a transaction in which a writer covers a position by purchasing an option is called:
closing sale
closing purchase
opening sale
EXAM QUESTIONS WITH COMPLETE EXAM
QUESTIONS WITH DETAILED VERIFIED
ANSWERS (100% CORRECT ANSWERS)
/ALREADY GRADED A+
The redemption value of an open-end investment company's shares is based on the:
previous offering price
previous closing NAV
NAV computed after the order is received
offering price computed after the order is received - ANSWER-NAV computed
after the order is received
The computation of dollar prices and accrued interest on municipal bonds is
normal on what calendar basis?
30/360
30/365
Actual/360
Actual/365 - ANSWER-30/360
Blue-sky laws are regulated by which of the following entities?
SEC
MSRB
FINRA
state securities regulators - ANSWER-State securities regulators
At the time of issuance, which of the following securities normally has the longest
period to expiration?
Rights
Options
Warrants
Repurchase agreements - ANSWER-Warrants
Regular way settlement on Treasury Bonds is:
same day
,next business day
second business day
fifth business day - ANSWER-next business day
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:
prohibited as fraudulent and manipulative.
Permissible if the securities are deposited into escrow.
prohibited unless the firm immediately sets aside funds for the repurchase
permissible if the customers retain the right to sell the securities into the open
market. - ANSWER-prohibited as fraudulent and manipulative
Under SEC S-P (Consumer Privacy), which of the following information must a
firm include in its customer privacy and opt-out notices?
the address of the firm's website
the fee to opt out from the privacy program
the deadline by which to opt out from the privacy program
the policies to protect the security of nonpublic information - ANSWER-the
policies to protect the security of nonpublic information
UTMA accounts are opened under the tax ID number of the:
minor
donor
parent
custodian - ANSWER-minor
Under FINRA rules, noncash compensation connected with the sale of variable
contracts includes all of the following items EXCEPT:
gifts
meals
lodging
commissions - ANSWER-commissions
Describe the difference between primary distribution and secondary distribution. -
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
If a market maker posts a quotes of 10.00 - 10.10 (25x10), which of the following
actions is the market maker willing to take?
sell 1,000 shares at $10 and buy 2,500 shares at $10.10
buy 2,500 shares at $10 and sell 1,000 shares at $10.10
sell 100 shares at $10 and buy 250 shares at $10.10
buy 250 shares at $10 and sell 100 shares at $10.10 - ANSWER-buy 2,500 shares
at $10 and sell 1,000 shares at $10.10
All of the following risks apply to both foreign and domestic debt instruments
EXCEPT:
political
exchange
repayment
interest rate - ANSWER-exchange
A married couple who earned income that exceeded $300k in each of the prior two
years and reasonably expects the same for this current year is:
a qualified investor
an accredited investor
an institutional investor
a qualified institutional buyer - ANSWER-an accredited investor
The owner of which of the following products is MOST exposed to inflationary
risks?
utility stocks
treasury bills
treasury bonds
blue chip industrials - ANSWER-treasury bonds
What is the concept of an annuity contract? - ANSWER-the kind of annuity
selected partly determines the payment amounts to the annuitant
Which of the following statement is true about all US Gov agency issues?
they are exempt from federal taxes
, they are exempt from registration under the Securities Act of 1933
they are issued in bearer form only
they are general obligations of the fed gov - ANSWER-they are exempt from
registration under the Securities Act of 1933
Direct participation programs (DPP's) provide:
liquidity and transparency
exposure to non-correlated assets with steady returns
market-related correlations with higher average returns
investors with direct purchases of stock from public companies - ANSWER-
exposure to non-correlated assets with steady returns
Which of the following outcomes are possible for the writer of a covered call
option?
profit limited and loss limited
profit limited and loss unlimited
profit unlimited and loss limited
profit unlimited and loss unlimited - ANSWER-profit limited and loss limited
when is interest on treasury notes paid?
quarterly
semiannually
annually
at maturity - ANSWER-semiannually
an associated person who is not a registered representative is permitted to engage
in which of the following activities?
accept an unsolicited customer order
provide account opening forms to a new customer
discuss the attributes of a particular investment product
prequalify prospective customers as to investment objectives - ANSWER-provide
account opening forms to a new customer
a transaction in which a writer covers a position by purchasing an option is called:
closing sale
closing purchase
opening sale
