SIE Practice Exam/Questions & Answers/A+ Rated
Solution
/.A customer writes an MMM January 70 put at 6. The maximum potential gain on this
position is - Answer-600
/.Your customer is long 1 October 75 put at 2. The customer's maximum gain potential
is - Answer-7300
/.Large time deposits of more than $100,000 are considered to be found in what part of
the money supply? - Answer-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 - Answer-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 - Answer-
a secondary offering
/.Which of the following is an example of an unsecured debt security?
Debenture
Preferred stock
Mortgage bond
Income bond - Answer-Debenture and Income bond
/.Mutual funds that market directly to the public, using no underwriter and charging no
sales charge, are called - Answer-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 - Answer-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 - Answer-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 - Answer-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 - Answer-keeps the $400 received when the call was
written
/.A mutual fund can offer all of the following to investors EXCEPT - Answer-physical
custody of the fund's portfolio cash and securities
/.In an LP, which of the following is TRUE? - Answer-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 - Answer-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 - Answer-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? - Answer-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? - Answer-$25 per share
/.Listed options expire on - Answer-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? - Answer-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
Solution
/.A customer writes an MMM January 70 put at 6. The maximum potential gain on this
position is - Answer-600
/.Your customer is long 1 October 75 put at 2. The customer's maximum gain potential
is - Answer-7300
/.Large time deposits of more than $100,000 are considered to be found in what part of
the money supply? - Answer-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 - Answer-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 - Answer-
a secondary offering
/.Which of the following is an example of an unsecured debt security?
Debenture
Preferred stock
Mortgage bond
Income bond - Answer-Debenture and Income bond
/.Mutual funds that market directly to the public, using no underwriter and charging no
sales charge, are called - Answer-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 - Answer-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 - Answer-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 - Answer-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 - Answer-keeps the $400 received when the call was
written
/.A mutual fund can offer all of the following to investors EXCEPT - Answer-physical
custody of the fund's portfolio cash and securities
/.In an LP, which of the following is TRUE? - Answer-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 - Answer-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 - Answer-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? - Answer-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? - Answer-$25 per share
/.Listed options expire on - Answer-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? - Answer-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
