SIE Exam Practice Questions and Answers (100% Pass)

SIE Exam Practice Questions and Answers (100% Pass) industrial development revenue bonds - Answer️️ -Industrial development revenue bonds are a type of taxable municipal security that is issued by a municipality on behalf of a corporation. Specifically, the municipality will issue to debt to build a facility on behalf of a corporation and then lease that facility to the corporation. Because the bonds are backed by lease payments made by the corporation, the debt is the responsibility and credit quality of the corporation. Which Gov Bond pays monthly interest? - Answer️️ -Ginnie Mae's pay interest monthly because the underlying mortgages that serve as collateral for the bonds also pay interest monthly. What type of fund trades above and below NAV - Answer️️ -A closed end investment company may trade at a premium or a discount to its net asset value. A "not-held" order means - Answer️️ -A "market, not-held" order means that the customer is letting the RR use her own best judgment as to the price and time at which the transaction will be executed, and will not hold the RR responsible if she misses the market for a security non-qualified variable annuity pays taxes on: - Answer️️ -Distributions from non- qualified variable annuities are subject to tax liability on the amount in excess of the original contribution (which was funded with after-tax dollars). Credit risk is best defined as the risk that - Answer️️ -Credit risk is the risk that the borrower will be unable to make the required payments on the loan to the ©PREP4EXAMS2024/2025 REAL EXAMS DUMP Thursday, August 8, 2024 6,44 PM 2 lender, including interest and principal. Notice that a borrower does not collect required payments from a lender, rather, lenders collect payments from borrowers. Restrictions to those who are in the Specially Designated Nationals list: - Answer️️ -The Specially Designated National List must be created pursuant to the USA Patriot Act, and transactions with parties on this list are strictly prohibited. In a period of stable interest rates, which preferred stock would fluctuate and why? - Answer️️ -The price of the convertible preferred stock is most likely to fluctuate in value because the price of the underlying common stock to which the preferred can be converted will influence the value of the preferred stock itself. Namely, if the price of the common stock increases, the price of the convertible preferred will also increase. What are the limits of trading under a statutory disqualification? - Answer️️ -A statutory disqualifcation will occur if a registered representative is conviction of any felony or a securities or fraud related misdemeanor in the past 10 years. Once statutory disqualified, the individual cannot be associated with a FINRA member firm unless they receive a waiver from FINRA. The interest income on federal agency securities is taxed at which levels? - Answer️️ -All levels An investor concerned about rising prices would most likely invest in a fixed or variable maturity? - Answer️️ -Investments in equities generally serve as a hedge against inflation. Fixed income investments, such as fixed annuities will lose purchasing power as prices increase. The tax consequence of an investment is not relevant when considering how to hedge against rising prices. ©PREP4EXAMS2024/2025 REAL EXAMS DUMP Thursday, August 8, 2024 6,44 PM 3 What is the difference between a U4 and a U5 form? - Answer️️ -A registered representative's U4 must be updated and kept current. Generally, an amended U4 must be completed within 30 days of a change, though any event resulting in a statutory disqualifcation must be reported within 10 days. A Form U5 would be filed for a termination of a rep's registration. When XYZ is 35, which of the following option contracts is out of the money? - Answer️️ -A put option is out of the money when the market price of the underlying security is above the strike price of the put option. What amount of money may a public official receive from the ass