Comprehensive SIE Practice Exam
2024 Questions & Answers 100%
Correct!!
The primary purpose of a syndicate desk in the context of an equity offering is to: - ANSWERbuild an
order book and allocate the stock
Which of the following responses describes an advantage of index funds? - ANSWERLower
management fees due to passive management of the fund
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution? - ANSWERA primary distribution involves a sale of newly
issued shares by the issuer while a secondary distribution involves the sale of already issued and
outstanding shares.
The computation of dollar prices and accrued interest on municipal bonds is normally on what
calendar basis? - ANSWER30/360
Direct participation programs (DPPs) provide: - ANSWERexposure to non-correlated assets
Call protection is most valuable to a bond owner when bond prices are generally: - ANSWERrising
Which of the following represents the effect of a stock split? - ANSWERThe price per share of
common stock decreases
Stability in the value of a debt portfolio is greatest when: - ANSWERmaturities of the debt securities
are short.
Which of the following actions is required of a broker-dealer's anti-money laundering (AML)
program? - ANSWERDesignating an AML compliance officer
Which of the following actions violates FINRA rules regarding selling away? - ANSWEREngaging in
private securities transactions without written prior consent of the employing BD
,Company ABC announces a 20% stock dividend for its common shareholders. If a customer holds
1,000 shares at $50.00, what is the new price and number of shares following the payment of the
stock dividend? - ANSWER1,200 shares at $41.67
Roth 401(k) and Roth individual retirement account (IRA) plans share which of the following
features? - ANSWERQualified distributions are excluded from federal income tax
Which of the following investment risks is the greatest risk in a variable life insurance policy? -
ANSWERMarket risk
In the event of a stock split, which of the following parties is required to maintain a record of the
shareholders eligible to receive the additional shares? - ANSWERTransfer agent
UTMA accounts are opened under the tax ID of the: - ANSWERminor
Under industry regulations, an initial purchase of $3,000 of common stock in a margin account
requires a cash deposit of: - ANSWER$2,000
At issue, which of the following debt securities mature in one year or less? - ANSWERMoney market
instruments
Which of the following considerations should a registered representative explain to a customer when
recommending a 529 savings plan? - ANSWERThe potential deductibility of contributions from state
taxes
A transaction in which a writer covers a position by purchasing an option is called: - ANSWERa closing
purchase
Broker-dealer ABC seeks to underwrite a municipal securities offering by a local town in which the
mayor is currently seeking re-election. A municipal finance professional who resides in the town and
works for ABC contributed $200 to the mayor's re-election campaign 13 months ago. If the employee
wants to support the campaign further without impacting the municipal securities business of the
firm, he is permitted to make an additional contribution of up to what amount? - ANSWER$50
, In which of the following situations is an employee of a public company permitted to trade upon
information without violating insider trading laws? - ANSWERAn independent securities analyst
explains to the employee why the earnings for the company next quarter could be markedly poorer
than expected.
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding? -
ANSWERSecured debt holders
An associated person who is not a registered representative is permitted to engage in which of the
following activities? - ANSWERProvide account opening forms to a new customer
The last transaction in XYZ 5.50s 2030 was at 102. This bond is selling at: - ANSWERa premium
A registered representative (RR) who wants to place a mutual fund advertisement must obtain
written approval from which of the following parties? - ANSWERA registered principal of the RR's
firm
Under normal circumstances, a customer's letter of intent on a mutual fund purchase is valid for
what maximum period of time? - ANSWER13 months
To offer its shareholders a privilege to obtain its shares at a fixed price, which of the following
products does a corporation issue? - ANSWERRights
The call provision of a bond stipulates which of the following factors? - ANSWERCall date and call
price
A decline in the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession? - ANSWER2 quarters
Regular way settlement on Treasury bonds is: - ANSWERnext business day
Which of the following statements is true regarding a customer account held as tenants in common?
- ANSWERThe ownership of the decedent's assets is governed by their will or state law.
Which of the following statements is true about treasury stock? - ANSWERIt is issued stock that has
been subsequently reacquired by the corporation
2024 Questions & Answers 100%
Correct!!
The primary purpose of a syndicate desk in the context of an equity offering is to: - ANSWERbuild an
order book and allocate the stock
Which of the following responses describes an advantage of index funds? - ANSWERLower
management fees due to passive management of the fund
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution? - ANSWERA primary distribution involves a sale of newly
issued shares by the issuer while a secondary distribution involves the sale of already issued and
outstanding shares.
The computation of dollar prices and accrued interest on municipal bonds is normally on what
calendar basis? - ANSWER30/360
Direct participation programs (DPPs) provide: - ANSWERexposure to non-correlated assets
Call protection is most valuable to a bond owner when bond prices are generally: - ANSWERrising
Which of the following represents the effect of a stock split? - ANSWERThe price per share of
common stock decreases
Stability in the value of a debt portfolio is greatest when: - ANSWERmaturities of the debt securities
are short.
Which of the following actions is required of a broker-dealer's anti-money laundering (AML)
program? - ANSWERDesignating an AML compliance officer
Which of the following actions violates FINRA rules regarding selling away? - ANSWEREngaging in
private securities transactions without written prior consent of the employing BD
,Company ABC announces a 20% stock dividend for its common shareholders. If a customer holds
1,000 shares at $50.00, what is the new price and number of shares following the payment of the
stock dividend? - ANSWER1,200 shares at $41.67
Roth 401(k) and Roth individual retirement account (IRA) plans share which of the following
features? - ANSWERQualified distributions are excluded from federal income tax
Which of the following investment risks is the greatest risk in a variable life insurance policy? -
ANSWERMarket risk
In the event of a stock split, which of the following parties is required to maintain a record of the
shareholders eligible to receive the additional shares? - ANSWERTransfer agent
UTMA accounts are opened under the tax ID of the: - ANSWERminor
Under industry regulations, an initial purchase of $3,000 of common stock in a margin account
requires a cash deposit of: - ANSWER$2,000
At issue, which of the following debt securities mature in one year or less? - ANSWERMoney market
instruments
Which of the following considerations should a registered representative explain to a customer when
recommending a 529 savings plan? - ANSWERThe potential deductibility of contributions from state
taxes
A transaction in which a writer covers a position by purchasing an option is called: - ANSWERa closing
purchase
Broker-dealer ABC seeks to underwrite a municipal securities offering by a local town in which the
mayor is currently seeking re-election. A municipal finance professional who resides in the town and
works for ABC contributed $200 to the mayor's re-election campaign 13 months ago. If the employee
wants to support the campaign further without impacting the municipal securities business of the
firm, he is permitted to make an additional contribution of up to what amount? - ANSWER$50
, In which of the following situations is an employee of a public company permitted to trade upon
information without violating insider trading laws? - ANSWERAn independent securities analyst
explains to the employee why the earnings for the company next quarter could be markedly poorer
than expected.
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding? -
ANSWERSecured debt holders
An associated person who is not a registered representative is permitted to engage in which of the
following activities? - ANSWERProvide account opening forms to a new customer
The last transaction in XYZ 5.50s 2030 was at 102. This bond is selling at: - ANSWERa premium
A registered representative (RR) who wants to place a mutual fund advertisement must obtain
written approval from which of the following parties? - ANSWERA registered principal of the RR's
firm
Under normal circumstances, a customer's letter of intent on a mutual fund purchase is valid for
what maximum period of time? - ANSWER13 months
To offer its shareholders a privilege to obtain its shares at a fixed price, which of the following
products does a corporation issue? - ANSWERRights
The call provision of a bond stipulates which of the following factors? - ANSWERCall date and call
price
A decline in the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession? - ANSWER2 quarters
Regular way settlement on Treasury bonds is: - ANSWERnext business day
Which of the following statements is true regarding a customer account held as tenants in common?
- ANSWERThe ownership of the decedent's assets is governed by their will or state law.
Which of the following statements is true about treasury stock? - ANSWERIt is issued stock that has
been subsequently reacquired by the corporation
