SIE practice exam || QUESTIONS WITH COMPLETE
SOLUTIONS!!
A customer writes an MMM January 70 put at 6. The maximum potential gain on this
position is correct answers 600
Your customer is long 1 October 75 put at 2. The customer's maximum gain potential is
correct answers 7300
Large time deposits of more than $100,000 are considered to be found in what part of the
money supply? correct answers M3
By purchasing shares of stock in a company, investors can benefit from which of the
following?
An increase in the price of the shares
An increase in price of the company's debt securities
An increase in the yield of the company's outstanding debt securities
The receipt of profits to be distributed correct answers An Increase in price of shares and The
receipts of profit to be distributed
An offering in which one or more stockholders in the corporation are selling all or a portion
of their own shares to the investing public for the first time is known as correct answers a
secondary offering
Which of the following is an example of an unsecured debt security?
Debenture
Preferred stock
Mortgage bond
Income bond correct answers Debenture and Income bond
Mutual funds that market directly to the public, using no underwriter and charging no sales
charge, are called correct answers No load funds
During the cooling-off period, underwriters of new securities may
accept orders to purchase shares
not accept orders to purchase shares
not accept indications of interest regarding potential purchases of shares
accept indications of interest regarding potential purchases of shares correct answers not
accept orders to purchase shares and accept indications of interest regarding potential
purchase of shares
The USA PATRIOT Act's required Customer Identification Program is designed chiefly to
prevent
real estate fraud
funding of terrorist activities
use of insider information
money laundering correct answers funding of terrorist activity and money laundering
, The firm element of a broker-dealer's continuing education requirement must be undergone
by all registered persons who correct answers have direct contact with the public
An August 15 call is written at 4. The call expires without being exercised by the owner. The
writer of the call correct answers keeps the $400 received when the call was written
A mutual fund can offer all of the following to investors EXCEPT correct answers physical
custody of the fund's portfolio cash and securities
In an LP, which of the following is TRUE? correct answers The partnership entity is not
responsible for paying taxes on gains
MAS Corporation has enjoyed an extremely profitable year. It has been determined that those
owning the MAS 4% preferred, participating to 6% preferred shares, will receive the full
participating dividend. The participating shareholders will receive an additional dividend of
correct answers 2%
A registered representative has a customer buying securities, but rather than paying in full,
the customer wants to borrow some of the money needed for the purchase from the broker-
dealer. It is explained to the customer that in order to borrow the money, there will be interest
payable based on correct answers the broker call loan rate
In the dividend disbursement process three of the four critical dates are determined by the
board of directors but one is determined by either FINRA for OTC stocks or the exchange for
listed stocks. Which one is it? correct answers ex dividend
An investor owns 500 shares of stock whose current market value is $20 per share. The stock
undergoes a split, after which the investor owns 400 shares. What is the new price of the
investor's stock? correct answers $25 per share
Listed options expire on correct answers the 3rd Friday of the expiration month
A corporation has issued a single bond having successive maturity dates set from 2020
through 2030. This is known as what type of bond? correct answers Serial
An investor discovers that exactly 2 years and 9 months ago, the investor was given
fraudulent information on a security that prompted the investor to sell it. As a result, the
investor lost money. How long does the investor have to bring action? correct answers 3
months
While a branch office manager can initially approve an options account for trading, it must
ultimately be approved by correct answers the firm's ROP
A shareholders' meeting for ABC Corporation will take place in 8 days. A customer whose
stock is being held in street name has not returned the proxy statements. Which of the
following is TRUE? correct answers The member firm may vote the shares as it wishes on
minor matters
SOLUTIONS!!
A customer writes an MMM January 70 put at 6. The maximum potential gain on this
position is correct answers 600
Your customer is long 1 October 75 put at 2. The customer's maximum gain potential is
correct answers 7300
Large time deposits of more than $100,000 are considered to be found in what part of the
money supply? correct answers M3
By purchasing shares of stock in a company, investors can benefit from which of the
following?
An increase in the price of the shares
An increase in price of the company's debt securities
An increase in the yield of the company's outstanding debt securities
The receipt of profits to be distributed correct answers An Increase in price of shares and The
receipts of profit to be distributed
An offering in which one or more stockholders in the corporation are selling all or a portion
of their own shares to the investing public for the first time is known as correct answers a
secondary offering
Which of the following is an example of an unsecured debt security?
Debenture
Preferred stock
Mortgage bond
Income bond correct answers Debenture and Income bond
Mutual funds that market directly to the public, using no underwriter and charging no sales
charge, are called correct answers No load funds
During the cooling-off period, underwriters of new securities may
accept orders to purchase shares
not accept orders to purchase shares
not accept indications of interest regarding potential purchases of shares
accept indications of interest regarding potential purchases of shares correct answers not
accept orders to purchase shares and accept indications of interest regarding potential
purchase of shares
The USA PATRIOT Act's required Customer Identification Program is designed chiefly to
prevent
real estate fraud
funding of terrorist activities
use of insider information
money laundering correct answers funding of terrorist activity and money laundering
, The firm element of a broker-dealer's continuing education requirement must be undergone
by all registered persons who correct answers have direct contact with the public
An August 15 call is written at 4. The call expires without being exercised by the owner. The
writer of the call correct answers keeps the $400 received when the call was written
A mutual fund can offer all of the following to investors EXCEPT correct answers physical
custody of the fund's portfolio cash and securities
In an LP, which of the following is TRUE? correct answers The partnership entity is not
responsible for paying taxes on gains
MAS Corporation has enjoyed an extremely profitable year. It has been determined that those
owning the MAS 4% preferred, participating to 6% preferred shares, will receive the full
participating dividend. The participating shareholders will receive an additional dividend of
correct answers 2%
A registered representative has a customer buying securities, but rather than paying in full,
the customer wants to borrow some of the money needed for the purchase from the broker-
dealer. It is explained to the customer that in order to borrow the money, there will be interest
payable based on correct answers the broker call loan rate
In the dividend disbursement process three of the four critical dates are determined by the
board of directors but one is determined by either FINRA for OTC stocks or the exchange for
listed stocks. Which one is it? correct answers ex dividend
An investor owns 500 shares of stock whose current market value is $20 per share. The stock
undergoes a split, after which the investor owns 400 shares. What is the new price of the
investor's stock? correct answers $25 per share
Listed options expire on correct answers the 3rd Friday of the expiration month
A corporation has issued a single bond having successive maturity dates set from 2020
through 2030. This is known as what type of bond? correct answers Serial
An investor discovers that exactly 2 years and 9 months ago, the investor was given
fraudulent information on a security that prompted the investor to sell it. As a result, the
investor lost money. How long does the investor have to bring action? correct answers 3
months
While a branch office manager can initially approve an options account for trading, it must
ultimately be approved by correct answers the firm's ROP
A shareholders' meeting for ABC Corporation will take place in 8 days. A customer whose
stock is being held in street name has not returned the proxy statements. Which of the
following is TRUE? correct answers The member firm may vote the shares as it wishes on
minor matters
