FINRA SIE Practice Test Questions
with Complete Solutions10
Upon Expiration, all in-the-money S&P 100 Index call options are settled by the delivery of
which of the following? - ANSWERS-Cash
Which of the following statements is true about treasury stock? - ANSWERS-It is issued stock
that has been subsequently reacquired by the corporation
In the event of a stock split, which of the following parties is required to maintain a record of
the shareholders eligible to receive the additional shares? - ANSWERS-Transfer Agent
Which of the following actions is required of a broker-dealer's anti-money laundering (AML)
program? - ANSWERS-Designating an AML compliance officer
A registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take? - ANSWERS-Send written notice to his supervisor
outlining the activity and compensation structure
A customer BUYS a 1 ABC Jan 35 PUT for a premium of $3 and simultaneously buys 100 shares
of ABC stock for $35 per share. The customer will break even when the stock is selling at what
price per share at expiration? - ANSWERS-$38
The call provision of a bond stipulates which of the following factors? - ANSWERS-Call date and
call price
When is interest on Treasury notes paid? - ANSWERS-Semiannually
, The owner of which of the following products is MOST exposed to inflationary risk? - ANSWERS-
Treasury bonds (because it's long-term)
A registered representative (RR) who wants to place a mutual fund advertisement must obtain
written approval from which of the following parties? - ANSWERS-A registered principal of the
RR's firm
A company announces a tender offer to its shareholders with the intent to buy a maximum of 1
million shares of its outstanding stock at $10 per share and sets no minimum number of shares
to be purchased. An investor wants to participate in this offer and tenders his 1,000 share
position. At the close of the offer period, only 900,000 shares have been tendered. How many, if
any, of the investor's shares will the company purchase? - ANSWERS-1,000 (1,000 x 100 =
100,000 shares; 1 million - 900k = 100k)
Broker-dealer ABC seeks to underwrite a municipal securities offering by a local town in which
the mayor is currently seeking re-election. A municipal finance professional who resides in the
town and works for ABC contributed $200 to the mayor's re-election campaign 13 months ago.
If the employee wants to support the campaign further without impacting the municipal
securities business of the firm, he is permitted to make an additional contribution of up to what
amount? - ANSWERS-$50 ($250 is the limit PER election)
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding? -
ANSWERS-Secured debt holders
[Order of liquidation at bankruptcy:
1. Unpaid wages
2. Taxes (IRS)
3. Secured claims (mortgages)
4. Secured liabilities (bonds)
5. Unsecured liabilities (debentures) and general creditors
6. Subordinated debt
with Complete Solutions10
Upon Expiration, all in-the-money S&P 100 Index call options are settled by the delivery of
which of the following? - ANSWERS-Cash
Which of the following statements is true about treasury stock? - ANSWERS-It is issued stock
that has been subsequently reacquired by the corporation
In the event of a stock split, which of the following parties is required to maintain a record of
the shareholders eligible to receive the additional shares? - ANSWERS-Transfer Agent
Which of the following actions is required of a broker-dealer's anti-money laundering (AML)
program? - ANSWERS-Designating an AML compliance officer
A registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take? - ANSWERS-Send written notice to his supervisor
outlining the activity and compensation structure
A customer BUYS a 1 ABC Jan 35 PUT for a premium of $3 and simultaneously buys 100 shares
of ABC stock for $35 per share. The customer will break even when the stock is selling at what
price per share at expiration? - ANSWERS-$38
The call provision of a bond stipulates which of the following factors? - ANSWERS-Call date and
call price
When is interest on Treasury notes paid? - ANSWERS-Semiannually
, The owner of which of the following products is MOST exposed to inflationary risk? - ANSWERS-
Treasury bonds (because it's long-term)
A registered representative (RR) who wants to place a mutual fund advertisement must obtain
written approval from which of the following parties? - ANSWERS-A registered principal of the
RR's firm
A company announces a tender offer to its shareholders with the intent to buy a maximum of 1
million shares of its outstanding stock at $10 per share and sets no minimum number of shares
to be purchased. An investor wants to participate in this offer and tenders his 1,000 share
position. At the close of the offer period, only 900,000 shares have been tendered. How many, if
any, of the investor's shares will the company purchase? - ANSWERS-1,000 (1,000 x 100 =
100,000 shares; 1 million - 900k = 100k)
Broker-dealer ABC seeks to underwrite a municipal securities offering by a local town in which
the mayor is currently seeking re-election. A municipal finance professional who resides in the
town and works for ABC contributed $200 to the mayor's re-election campaign 13 months ago.
If the employee wants to support the campaign further without impacting the municipal
securities business of the firm, he is permitted to make an additional contribution of up to what
amount? - ANSWERS-$50 ($250 is the limit PER election)
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding? -
ANSWERS-Secured debt holders
[Order of liquidation at bankruptcy:
1. Unpaid wages
2. Taxes (IRS)
3. Secured claims (mortgages)
4. Secured liabilities (bonds)
5. Unsecured liabilities (debentures) and general creditors
6. Subordinated debt
