Series 65: Unit 23 Exam
A new customer of your broker-dealer calls after her first stock purchase. She comments that she did not
see a commission charged on the trade confirmation and wants to thank you for the good deal. It would
be incumbent on you to
A. explain that the firm acted as a principal and included a markup in the price.
B. report this to your supervisor promptly.
C. reply with a thank you and tell her you're looking forward to more trades.
D. explain that your firm does that on the first trade to help build the relationship. - correct answer
✔✔Explain that the firm acted as a principal and included a markup in the price
Which of the following statements about stop orders is not true?
A. A sell stop order is always placed at a price that is below the current market price.
B. A stop order will become a market order once a security trades at or through a specified price.
C. A stop order to buy is always set at a price that is higher than the current market price.
D. A sell stop order is used to protect a short sale. - correct answer ✔✔A sell stop order is used to
protect a short sale
By viewing the bid and ask prices, which of the following OTC stocks is likely to be the most actively
traded?
A. 50-50.50
B. 17.95-18.25
C. 22-23
D. 43-43.05 - correct answer ✔✔43-43.05
Which of the following cannot be purchased on margin?
, A. A long call option traded on the CBOE
B. A listed bond
C. An NYSE-listed stock
D. A municipal bond - correct answer ✔✔A long call option traded on the CBOE
An order to immediately buy or sell a security at the best available price is known as
A. a market order.
B. a stop order.
C. a limit order.
D. an immediate or cancel (IOC) order. - correct answer ✔✔A market order
A client with a bullish outlook on a particular stock would be able to benefit most from taking which of
the following actions?
A. Entering a buy stop
B. Entering a sell limit order
C. Buying the stock on margin
D. Selling the stock short - correct answer ✔✔Buying the stock on margin
When a security purchased on margin suffers a decline in market value, it may cause the equity in the
account to fall to a level such that additional funds are required under the terms of the margin
agreement between the client and the broker-dealer. The term that describes the request by a broker-
dealer rather than an SRO for more money is
A. margin call.
B. house call.
C. sell-out.
D. Regulation T call. - correct answer ✔✔House call
A new customer of your broker-dealer calls after her first stock purchase. She comments that she did not
see a commission charged on the trade confirmation and wants to thank you for the good deal. It would
be incumbent on you to
A. explain that the firm acted as a principal and included a markup in the price.
B. report this to your supervisor promptly.
C. reply with a thank you and tell her you're looking forward to more trades.
D. explain that your firm does that on the first trade to help build the relationship. - correct answer
✔✔Explain that the firm acted as a principal and included a markup in the price
Which of the following statements about stop orders is not true?
A. A sell stop order is always placed at a price that is below the current market price.
B. A stop order will become a market order once a security trades at or through a specified price.
C. A stop order to buy is always set at a price that is higher than the current market price.
D. A sell stop order is used to protect a short sale. - correct answer ✔✔A sell stop order is used to
protect a short sale
By viewing the bid and ask prices, which of the following OTC stocks is likely to be the most actively
traded?
A. 50-50.50
B. 17.95-18.25
C. 22-23
D. 43-43.05 - correct answer ✔✔43-43.05
Which of the following cannot be purchased on margin?
, A. A long call option traded on the CBOE
B. A listed bond
C. An NYSE-listed stock
D. A municipal bond - correct answer ✔✔A long call option traded on the CBOE
An order to immediately buy or sell a security at the best available price is known as
A. a market order.
B. a stop order.
C. a limit order.
D. an immediate or cancel (IOC) order. - correct answer ✔✔A market order
A client with a bullish outlook on a particular stock would be able to benefit most from taking which of
the following actions?
A. Entering a buy stop
B. Entering a sell limit order
C. Buying the stock on margin
D. Selling the stock short - correct answer ✔✔Buying the stock on margin
When a security purchased on margin suffers a decline in market value, it may cause the equity in the
account to fall to a level such that additional funds are required under the terms of the margin
agreement between the client and the broker-dealer. The term that describes the request by a broker-
dealer rather than an SRO for more money is
A. margin call.
B. house call.
C. sell-out.
D. Regulation T call. - correct answer ✔✔House call
