FINRA SIE CORRECT STUDY QUESTIONS AND
ANSWERS SET A+
✔✔what is the cost basis of an inherited mutual fund?
the NAV of the shares when the owner dies
the NAV 30 days after the owner's death
the same cost basis as the deceased
the same cost basis as the deceased plus capital gains distribution - ✔✔the NAV of the
shares when the owner dies
✔✔an investor owns 100 shares of XYZ common stock at the current market price of
$50 per share. if XYZ conducts a 1-for-2 reverse stock split, the investor's post stock-
split position will be:
50 shares at $25 per share
50 shares at $100 per share
200 shares at $25 per share
200 shares at $100 per share - ✔✔50 shares at $100 per share
✔✔a member of a stock exchange responsible for providing liquidity in a security by
being willing to buy and sell at all times is known as a:
broker
underwriter
market maker
transfer agent - ✔✔market maker
✔✔under industry regulations, an initial purchase of $3k of common stock in a margin
account requires a cash deposit of:
$750
$1,500
$2,000
$3,000 - ✔✔$2,000
✔✔which of the following communications with the public is considered misleading?
, historical illustrations based on factual performance
product comparisons that illustrate material differences
a research report that includes a buy recommendation for a specific security
literature providing a 10-year performance information to support predictions of future
performance - ✔✔literature providing 10-year performance information to support
predictions of future performance
✔✔the primary purpose of a syndicate desk in the context of an equity offering is to:
determine the list of selling shareholders
build an order book and allocate the stock
solicit interest from investors in the stock offering
chaperone company management during the road show - ✔✔build an order book and
allocate the stock
✔✔which of the following represents the effect of a stock split?
the price per share of common stock increases
the price per share of common stock decreases
each stockholder's proportionate ownership decreases
each stockholder's proportionate ownership increases - ✔✔the price per share of
common stock decreases
✔✔a customer has a cash balance in her account together with long positions in several
securities. she has made no securities transactions in the account during the past 18
months. how often must the firm send her an account statement?
monthly
quarterly
semiannually
annually - ✔✔quarterly
✔✔a customer is an officer of a company that is involved in some significant changes.
all of the following items are examples of corporate affairs that could be considered
inside information if the customer shares them with his registered representative
EXCEPT:
pending transactions
declared stock dividend
top management changes
imminent financial liquidity problems - ✔✔declared stock dividend
✔✔when selling a fixed amount of a base currency to purchase a counter currency,
which of the following factors is primarily used to determine how much of the counter
currency the customer will receive?
the spot exchange rate
the counter currency's inflation rate
the trade balance between the two countries
the credit rating of the counter currency's government - ✔✔the spot exchange rate
ANSWERS SET A+
✔✔what is the cost basis of an inherited mutual fund?
the NAV of the shares when the owner dies
the NAV 30 days after the owner's death
the same cost basis as the deceased
the same cost basis as the deceased plus capital gains distribution - ✔✔the NAV of the
shares when the owner dies
✔✔an investor owns 100 shares of XYZ common stock at the current market price of
$50 per share. if XYZ conducts a 1-for-2 reverse stock split, the investor's post stock-
split position will be:
50 shares at $25 per share
50 shares at $100 per share
200 shares at $25 per share
200 shares at $100 per share - ✔✔50 shares at $100 per share
✔✔a member of a stock exchange responsible for providing liquidity in a security by
being willing to buy and sell at all times is known as a:
broker
underwriter
market maker
transfer agent - ✔✔market maker
✔✔under industry regulations, an initial purchase of $3k of common stock in a margin
account requires a cash deposit of:
$750
$1,500
$2,000
$3,000 - ✔✔$2,000
✔✔which of the following communications with the public is considered misleading?
, historical illustrations based on factual performance
product comparisons that illustrate material differences
a research report that includes a buy recommendation for a specific security
literature providing a 10-year performance information to support predictions of future
performance - ✔✔literature providing 10-year performance information to support
predictions of future performance
✔✔the primary purpose of a syndicate desk in the context of an equity offering is to:
determine the list of selling shareholders
build an order book and allocate the stock
solicit interest from investors in the stock offering
chaperone company management during the road show - ✔✔build an order book and
allocate the stock
✔✔which of the following represents the effect of a stock split?
the price per share of common stock increases
the price per share of common stock decreases
each stockholder's proportionate ownership decreases
each stockholder's proportionate ownership increases - ✔✔the price per share of
common stock decreases
✔✔a customer has a cash balance in her account together with long positions in several
securities. she has made no securities transactions in the account during the past 18
months. how often must the firm send her an account statement?
monthly
quarterly
semiannually
annually - ✔✔quarterly
✔✔a customer is an officer of a company that is involved in some significant changes.
all of the following items are examples of corporate affairs that could be considered
inside information if the customer shares them with his registered representative
EXCEPT:
pending transactions
declared stock dividend
top management changes
imminent financial liquidity problems - ✔✔declared stock dividend
✔✔when selling a fixed amount of a base currency to purchase a counter currency,
which of the following factors is primarily used to determine how much of the counter
currency the customer will receive?
the spot exchange rate
the counter currency's inflation rate
the trade balance between the two countries
the credit rating of the counter currency's government - ✔✔the spot exchange rate
