STC SERIES 66 CHAPTER 1 TEST
COMPLETE QUESTIONS AND ANSWERS
WITH VERIFIED SOLUTIONS LATEST
UPDATE 2025/2026
Which of the following choices would be considered a person under the USA?
I. A customer
II. A broker-dealer
III. An estate
IV. An issuer - CORRECT ANSWER - I, II, III, and IV
Under the USA, a person is defined as a legal entity, which would include
individuals (natural persons) and business entities such as corporations, broker-
dealers, partnerships, and investment advisers.
If a broker-dealer is publishing both bid and ask prices for securities in the
secondary market, it's acting as a: - CORRECT ANSWER - Market maker
Market makers are firms that act as dealers in offering to buy and sell securities in
the secondary market at their own risk. (18679)
Under the Uniform Securities Act, which individual is considered to be an agent? -
CORRECT ANSWER - A secretary who accepts customers' securities orders
An agent is defined as a person who represents either a broker-dealer or an issuer
in effecting securities transactions. The definition excludes principals of broker-
dealers, clerical employees who do not accept customer orders, and silent partners.
An individual represents an issuer in the sale of the issuer's securities to its
employees, but does not earn commissions on the transactions. The individual is: -
CORRECT ANSWER - Not considered to be an agent of the issuer
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, An agent is an individual who represents a broker-dealer or an issuer in effecting
securities transactions. However, an individual who represents an issuer in a
transaction with existing employees and does not receive commissions is NOT
considered to be an agent. In this question, the individual does not fall under the
definition of either a broker-dealer or an issuer.
Which TWO of the following meet the definition of a broker-dealer under the
Uniform Securities Act?
I. An agent of a broker-dealer who effects securities transactions for the firm
II. A person that effects securities transactions for the accounts of others
III. A person that effects securities transactions for its own account
IV. A representative of an IA who provides securities related advice to
customers - CORRECT ANSWER - II and III
Under the Uniform Securities Act, a broker-dealer is defined as a person that is in
the business of effecting securities transactions either for the accounts of others or
for its own account. For that reason, choices (II) (acting as a broker) and (III)
(acting as a dealer) are correct. Choice (I) is the individual agent who represents
the broker-dealer in effecting securities transactions. Remember, agents are NOT
considered to be broker-dealers. Choice (IV) is an individual investment adviser
representative who provides advice to the advisory firm's clients and manages
accounts/portfolios. Investment adviser representatives are NOT considered to be
broker-dealers.
Which of the following terms is NOT specifically defined under the Uniform
Securities Act? - CORRECT ANSWER - Broker-dealer representative
An agent is defined as a person who is employed by a broker-dealer or issuer to
sell securities. There is no mention of the term broker-dealer representative. An
investment adviser representative is a person employed by an investment adviser
who provides investment advice.
Under the Uniform Securities Act, all of the following persons are considered
investment adviser representatives, EXCEPT: - CORRECT ANSWER - An
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COMPLETE QUESTIONS AND ANSWERS
WITH VERIFIED SOLUTIONS LATEST
UPDATE 2025/2026
Which of the following choices would be considered a person under the USA?
I. A customer
II. A broker-dealer
III. An estate
IV. An issuer - CORRECT ANSWER - I, II, III, and IV
Under the USA, a person is defined as a legal entity, which would include
individuals (natural persons) and business entities such as corporations, broker-
dealers, partnerships, and investment advisers.
If a broker-dealer is publishing both bid and ask prices for securities in the
secondary market, it's acting as a: - CORRECT ANSWER - Market maker
Market makers are firms that act as dealers in offering to buy and sell securities in
the secondary market at their own risk. (18679)
Under the Uniform Securities Act, which individual is considered to be an agent? -
CORRECT ANSWER - A secretary who accepts customers' securities orders
An agent is defined as a person who represents either a broker-dealer or an issuer
in effecting securities transactions. The definition excludes principals of broker-
dealers, clerical employees who do not accept customer orders, and silent partners.
An individual represents an issuer in the sale of the issuer's securities to its
employees, but does not earn commissions on the transactions. The individual is: -
CORRECT ANSWER - Not considered to be an agent of the issuer
1|Page
, An agent is an individual who represents a broker-dealer or an issuer in effecting
securities transactions. However, an individual who represents an issuer in a
transaction with existing employees and does not receive commissions is NOT
considered to be an agent. In this question, the individual does not fall under the
definition of either a broker-dealer or an issuer.
Which TWO of the following meet the definition of a broker-dealer under the
Uniform Securities Act?
I. An agent of a broker-dealer who effects securities transactions for the firm
II. A person that effects securities transactions for the accounts of others
III. A person that effects securities transactions for its own account
IV. A representative of an IA who provides securities related advice to
customers - CORRECT ANSWER - II and III
Under the Uniform Securities Act, a broker-dealer is defined as a person that is in
the business of effecting securities transactions either for the accounts of others or
for its own account. For that reason, choices (II) (acting as a broker) and (III)
(acting as a dealer) are correct. Choice (I) is the individual agent who represents
the broker-dealer in effecting securities transactions. Remember, agents are NOT
considered to be broker-dealers. Choice (IV) is an individual investment adviser
representative who provides advice to the advisory firm's clients and manages
accounts/portfolios. Investment adviser representatives are NOT considered to be
broker-dealers.
Which of the following terms is NOT specifically defined under the Uniform
Securities Act? - CORRECT ANSWER - Broker-dealer representative
An agent is defined as a person who is employed by a broker-dealer or issuer to
sell securities. There is no mention of the term broker-dealer representative. An
investment adviser representative is a person employed by an investment adviser
who provides investment advice.
Under the Uniform Securities Act, all of the following persons are considered
investment adviser representatives, EXCEPT: - CORRECT ANSWER - An
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