FINRA SIE PRACTICE TEST EXAM
QUESTIONS WITH COMPLETE SOLUTIONS
GRADED A+
QUESTIONS AND ANSWERS
Upon Expiration, all in-the-money S&P 100 Index call options are settled by the
delivery of which of the following?. ANSWER - Cash
Which of the following statements is true about treasury stock?. ANSWER - 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?. ANSWER -
Transfer Agent
Which of the following actions is required of a broker-dealer's anti-money laundering
(AML) program?. ANSWER - 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?. ANSWER - 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?. ANSWER - $38
The call provision of a bond stipulates which of the following factors?. ANSWER -
Call date and call price
, When is interest on Treasury notes paid?. ANSWER - Semiannually
The owner of which of the following products is MOST exposed to inflationary risk?.
ANSWER - 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?. ANSWER - 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?. ANSWER - 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?. ANSWER - $50
($250 is the limit PER election)
Which of the following stakeholders has first claim priority in a Chapter 11
proceeding?. ANSWER - Secured debt holders
[Order of liquidation at bankruptcy:
1. Unpaid wages
2. Taxes (IRS)
QUESTIONS WITH COMPLETE SOLUTIONS
GRADED A+
QUESTIONS AND ANSWERS
Upon Expiration, all in-the-money S&P 100 Index call options are settled by the
delivery of which of the following?. ANSWER - Cash
Which of the following statements is true about treasury stock?. ANSWER - 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?. ANSWER -
Transfer Agent
Which of the following actions is required of a broker-dealer's anti-money laundering
(AML) program?. ANSWER - 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?. ANSWER - 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?. ANSWER - $38
The call provision of a bond stipulates which of the following factors?. ANSWER -
Call date and call price
, When is interest on Treasury notes paid?. ANSWER - Semiannually
The owner of which of the following products is MOST exposed to inflationary risk?.
ANSWER - 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?. ANSWER - 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?. ANSWER - 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?. ANSWER - $50
($250 is the limit PER election)
Which of the following stakeholders has first claim priority in a Chapter 11
proceeding?. ANSWER - Secured debt holders
[Order of liquidation at bankruptcy:
1. Unpaid wages
2. Taxes (IRS)
