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LET’S PRACTICE!
#1. Which of the following best describes the primary objective of the Securities Act of 1933?
#2. Which market is used when an issuer sells new securities directly to investors?
#3. Trading of listed securities between investors on an exchange occurs in the:
#4. Which of the following is an example of a self-regulatory organization (SRO)?
#5. Which of the following best describes the role of FINRA?
#6. Which of the following securities must be registered with the SEC unless an exemption applies?
#7. Which of the following is TRUE regarding an initial public offering (IPO)?
#8. Which document is used by an issuer to register securities with the SEC?
#9. A preliminary prospectus is sometimes called a:
#10. Which type of underwriting exposes the underwriter to the greatest financial risk?
#11. In a best-efforts underwriting, the underwriter:
#12. Which of the following transactions occurs in the third market?
#13. A broker-dealer that effects trades for customers and charges commissions is acting as:
#14. A broker-dealer that trades securities for its own account, charging markups or markdowns, is acting as:
#15. Which of the following securities represents an equity interest in a corporation?
#16. Common shareholders typically have which of the following rights?
#17. Which of the following statements about preferred stock is TRUE?
#18. Which of the following describes a callable bond?
#19. Which of the following is most sensitive to interest-rate changes?
#20. Which of the following securities is issued by corporations to finance long-term capital needs?
#21. The par value of a typical corporate bond is:
#22. Which of the following municipal securities is backed by the full taxing power of the issuer?
#23. Revenue bonds are typically backed by:
#24. Treasury bills are issued with which of the following characteristics?
#25. Which of the following securities helps protect investors from inflation by adjusting principal?
#26. Which of the following is an example of a money market instrument?
#27. Which of the following statements about mutual funds is TRUE?
#28. An open-end investment company is also known as a:
#29. Which of the following investment companies issues a fixed number of shares that trade in the secondary market?
#30. An exchange-traded fund (ETF) is most similar to a mutual fund but:
#31. A real estate investment trust (REIT) primarily invests in:
#32. Which of the following best describes an American Depositary Receipt (ADR)?
#33. Which of the following investors would be MOST appropriate for a high-yield bond fund?
#34. Which of the following is a key feature of a variable annuity?
#35. During the accumulation phase of a variable annuity, contributions purchase:
#36. Which of the following best describes a mutual fund’s load?
#37. Which share class of a mutual fund is MOST likely to impose a level load (annual 12b-1) in place of a front-end sales charge?
#38. Breakpoints in mutual funds are based on:
#39. A letter of intent (LOI) in mutual funds allows an investor to:
#40. Diversification in a portfolio is primarily intended to reduce:
#41. Which of the following strategies is an example of dollar-cost averaging?
#42. Which of the following is considered a leading economic indicator?
#43. Which phase of the business cycle is typically associated with rising GDP and falling unemployment?
#44. Which of the following is a primary tool of the Federal Reserve to conduct monetary policy?
#45. Tight monetary policy by the Federal Reserve typically results in:
#46. Which of the following best describes a progressive tax system?
#47. Capital gains on securities held more than one year are generally taxed at:
#48. A customer’s investment profile includes which of the following?
#49. Which of the following is a key requirement of Regulation Best Interest (Reg BI)?
#50. Form CRS is a brief customer relationship summary that must be delivered:
#51. Which of the following communications is classified as correspondence under FINRA rules?
#52. Retail communication is generally defined as written or electronic communication distributed to:
#53. Which of the following is considered insider trading?
#54. The USA PATRIOT Act requires broker-dealers to establish procedures to:
#55. A Currency Transaction Report (CTR) is generally required for cash deposits or withdrawals over:
#56. Which of the following is considered a suspicious activity that may require filing an SAR?
#57. Sharing in a customer’s account is generally permitted only if:
#58. Churning is best described as:
#59. Which of the following orders is used to buy stock once it trades at or above a specified price?
#60. A customer who sells short 100 shares of stock profits if the stock price:
#61. An order that must be executed immediately for as much as possible and any unfilled portion is canceled is:
#62. A customer with a short time horizon and low risk tolerance is MOST suitable for:
#63. Which type of account registration allows unequal ownership percentages and passes the decedent’s share to their estate?
#64. Which of the following is TRUE regarding SIPC coverage?
#65. Which of the following plans is primarily used by public school employees and certain nonprofits?
#66. Which of the following best describes a defined benefit plan?
#67. Which of the following is TRUE about Roth IRA contributions?
#68. Which of the following accounts is most appropriate for setting aside funds for a child’s college education with potential tax advantages?
#69. Which of the following statements about 529 savings plans is TRUE?
#70. Which of the following is a potential benefit of investing in municipal bonds for a high-income investor?
#71. Which of the following is a characteristic of a growth mutual fund?
#72. Which of the following is typically considered a conservative investment suitable for preservation of capital?
#73. Which of the following is the primary goal of asset allocation?
#74. Which of the following is an example of non-systematic risk?
#75. Which of the following investments is MOST appropriate for an investor seeking steady current income with moderate risk?
