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| Section | Weight | Objectives |
|---|---|---|
| Provides Customers with Information About Investments, Makes Suitable Recommendations, Transfers Assets and Maintains Appropriate Records | 73% | - Customer recommendations and transactions
|
| Seeks Business for the Broker-Dealer from Customers and Potential Customers | 9% | - Customer acquisition and prospecting
|
| Obtains and Verifies Customers' Purchase and Sale Instructions and Agreements; Processes, Completes and Confirms Transactions | 7% | - Trade execution and settlement
|
| Opens Accounts After Obtaining and Evaluating Customers' Financial Profile and Investment Objectives | 11% | - Customer accounts and documentation
|
1. An offering price of 102 plus accrued interest applies to which of the following securities?
A) certificates of deposit
B) commercial paper
C) banker's acceptances
D) treasury bills
2. Which of the following securities provides the longest term of option privilege?
A) warrants
B) rights
C) calls
D) puts
3. Which of the following organizations usually has a prominent role in guiding investment policies of mutual
funds?
A) the underwriter
B) the custodian bank
C) the management group
D) the plan company
4. Bubba buys one XYZ September 50 call at $7 and sells one XYZ September 60 call at $3. At that time,
XYZ stock is at $55. Bubba has no other stock positions. What is Bubba's maximum possible profit?
A) $1,000
B) $500
C) $600
D) unlimited
5. When a member firm buys or sells securities directly as principal with a public customer, it is acting as:
A) a dealer
B) an agent
C) a broker
D) none of the above
Solutions:
| Question # 1 Answer: A | Question # 2 Answer: A | Question # 3 Answer: C | Question # 4 Answer: C | Question # 5 Answer: A |
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