COMPREHENSIVE SIE PRACTICE EXAM EXPECTED
QUESTIONS WITH VERIFIED ANSWERS
Question 1.
The primary purpose of a syndicate desk in the context of an equity offering is to:
ANSWER
build an order book and allocate the stock
Question 2.
Which of the following responses describes an advantage of index funds?
ANSWER
Lower management fees due to passive management of the fund
Question 3.
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution?
ANSWER
A primary distribution involves a sale of newly issued shares by the issuer while a secondary
distribution involves the sale of already issued and outstanding shares.
Question 4.
The computation of dollar prices and accrued interest on municipal bonds is normally on what calendar
basis?
ANSWER
30/360
Question 5.
Direct participation programs (DPPs) provide:
ANSWER
exposure to non-correlated assets
,Question 6.
Call protection is most valuable to a bond owner when bond prices are generally:
ANSWER
rising
Question 7.
Which of the following represents the effect of a stock split?
ANSWER
The price per share of common stock decreases
Question 8.
Stability in the value of a debt portfolio is greatest when:
ANSWER
maturities of the debt securities are short.
Question 9.
Which of the following actions is required of a broker-dealer's anti-money laundering (AML) program?
ANSWER
Designating an AML compliance officer
Question 10.
Which of the following actions violates FINRA rules regarding selling away?
ANSWER
Engaging in private securities transactions without written prior consent of the employing BD
Question 11.
Company ABC announces a 20% stock dividend for its common shareholders. If a customer holds 1,000
shares at $50.00, what is the new price and number of shares following the payment of the stock
dividend?
ANSWER
1,200 shares at $41.67
,Question 12.
Roth 401(k) and Roth individual retirement account (IRA) plans share which of the following features?
ANSWER
Qualified distributions are excluded from federal income tax
Question 13.
An associated person who is not a registered representative is permitted to engage in which of the
following activities?
ANSWER
Provide account opening forms to a new customer
Question 14.
The last transaction in XYZ 5.50s 2030 was at 102. This bond is selling at:
ANSWER
a premium
Question 15.
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
Question 16.
Under normal circumstances, a customer's letter of intent on a mutual fund purchase is valid for what
maximum period of time?
ANSWER
13 months
, Question 17.
To offer its shareholders a privilege to obtain its shares at a fixed price, which of the following products
does a corporation issue?
ANSWER
Rights
Question 18.
The call provision of a bond stipulates which of the following factors?
ANSWER
Call date and call price
Question 19.
A decline in the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession?
ANSWER
2 quarters
Question 20.
Regular way settlement on Treasury bonds is:
ANSWER
next business day
Question 21.
Which of the following statements is true regarding a customer account held as tenants in common?
ANSWER
The ownership of the decedent's assets is governed by their will or state law.
Question 22.
Which of the following statements is true about treasury stock?
ANSWER
It is issued stock that has been subsequently reacquired by the corporation
QUESTIONS WITH VERIFIED ANSWERS
Question 1.
The primary purpose of a syndicate desk in the context of an equity offering is to:
ANSWER
build an order book and allocate the stock
Question 2.
Which of the following responses describes an advantage of index funds?
ANSWER
Lower management fees due to passive management of the fund
Question 3.
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution?
ANSWER
A primary distribution involves a sale of newly issued shares by the issuer while a secondary
distribution involves the sale of already issued and outstanding shares.
Question 4.
The computation of dollar prices and accrued interest on municipal bonds is normally on what calendar
basis?
ANSWER
30/360
Question 5.
Direct participation programs (DPPs) provide:
ANSWER
exposure to non-correlated assets
,Question 6.
Call protection is most valuable to a bond owner when bond prices are generally:
ANSWER
rising
Question 7.
Which of the following represents the effect of a stock split?
ANSWER
The price per share of common stock decreases
Question 8.
Stability in the value of a debt portfolio is greatest when:
ANSWER
maturities of the debt securities are short.
Question 9.
Which of the following actions is required of a broker-dealer's anti-money laundering (AML) program?
ANSWER
Designating an AML compliance officer
Question 10.
Which of the following actions violates FINRA rules regarding selling away?
ANSWER
Engaging in private securities transactions without written prior consent of the employing BD
Question 11.
Company ABC announces a 20% stock dividend for its common shareholders. If a customer holds 1,000
shares at $50.00, what is the new price and number of shares following the payment of the stock
dividend?
ANSWER
1,200 shares at $41.67
,Question 12.
Roth 401(k) and Roth individual retirement account (IRA) plans share which of the following features?
ANSWER
Qualified distributions are excluded from federal income tax
Question 13.
An associated person who is not a registered representative is permitted to engage in which of the
following activities?
ANSWER
Provide account opening forms to a new customer
Question 14.
The last transaction in XYZ 5.50s 2030 was at 102. This bond is selling at:
ANSWER
a premium
Question 15.
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
Question 16.
Under normal circumstances, a customer's letter of intent on a mutual fund purchase is valid for what
maximum period of time?
ANSWER
13 months
, Question 17.
To offer its shareholders a privilege to obtain its shares at a fixed price, which of the following products
does a corporation issue?
ANSWER
Rights
Question 18.
The call provision of a bond stipulates which of the following factors?
ANSWER
Call date and call price
Question 19.
A decline in the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession?
ANSWER
2 quarters
Question 20.
Regular way settlement on Treasury bonds is:
ANSWER
next business day
Question 21.
Which of the following statements is true regarding a customer account held as tenants in common?
ANSWER
The ownership of the decedent's assets is governed by their will or state law.
Question 22.
Which of the following statements is true about treasury stock?
ANSWER
It is issued stock that has been subsequently reacquired by the corporation
