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SIE Exam Practice Questions and Answers (100% Pass)
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SIE Exam Practice Questions and Answers (100% Pass) Which of the following is a true statement regarding warrants? A) Warrants are normally issued along with a bond offering as a unit. B) The warrant allows the holder to exercise and purchase the stock at a price lower than the market. C) W...

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  • August 31, 2024
  • 53
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • sie exam practice questions and answers 100 pass

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©PREP4EXAMS2024/2025 REAL EXAMS DUMP Wednesday, August 7, 2024 9: 33 PM



SIE Exam Practice Questions and Answers (100% Pass)

Which of the following is a true statement regarding warrants?

A)

Warrants are normally issued along with a bond offering as a unit.

B)

The warrant allows the holder to exercise and purchase the stock at a price lower
than the market.

C)

Warrants are short-term instruments, typically 30 to 45 days.

D)

Warrants are issued to existing shareholders on a basis of one right for one existing
share. - Answer✔️✔️-Warrants are normally issued along with a bond offering as a
unit

Which of the following preferred stocks allows the issuer to pay the shareholders
par and cease dividend payments following a stated period?

A)

Adjustable

B)

Callable

C)

Puttable



1

,©PREP4EXAMS2024/2025 REAL EXAMS DUMP Wednesday, August 7, 2024 9: 33 PM


D)

Redeemable - Answer✔️✔️-Callable



-Issuer can pay off callable preferred at any time after the call protection period,
and dividends will cease.

In order to receive a declared dividend a shareholder must be an owner of record at
the close of business on the

A)

declaration date.

B)

payable date.

C)

ex-dividend date.

D)

record date. - Answer✔️✔️-Record date

Which of the following is a true statement regarding warrants?

A)

The warrant allows the holder to exercise and purchase the stock at a price lower
than the market.

B)

The warrant is a long-term instrument, typically with five years or more until
expiration.



2

,©PREP4EXAMS2024/2025 REAL EXAMS DUMP Wednesday, August 7, 2024 9: 33 PM


C)

Warrants are issued to existing shareholders on a basis of one right for one existing
share.

D)

Warrants are short-term instruments, typically 30 to 45 days. - Answer✔️✔️-The
warrant is a long-term instrument, typically with five years or more until expiration

BigTel Inc., has been the only provider of telephone service for over a century. The
courts have declared BigTel is an unlawful monopoly and orders the company to
break into smaller, competing companies. Owners of BigTel stock will retain their
shares of BigTel (now smaller) and receive shares of three new companies: East-
Tel, Cent-Tel, and West-Tel. Which of these is a tax consequence that could occur
for this break up of BigTel and the receipt of the new shares?

A)

Partial-long-term capital gain

B)

Capital gain dependent on how long the shares were held

C)

Income based on the value of the new shares received

D)

There is no taxable consequence - Answer✔️✔️-There is no taxable consequence




3

, ©PREP4EXAMS2024/2025 REAL EXAMS DUMP Wednesday, August 7, 2024 9: 33 PM


-This spinoff is not a taxable event. Each new share will have a new cost basis
based on a percentage of the original cost basis. There is no taxable event until
shares are sold.

When the board of directors (BOD) declares a dividend,

A)

owners of preferred shares must be paid at least the same amount as any payment
made to common shareholders.

B)

owners of preferred shares are paid only after any payment is made to common
shareholders.

C)

owners of common shares must be paid at least the same amount as any payment
made to preferred shareholders.

D)

owners of preferred shares must be paid before any payment is made to common
shareholders. - Answer✔️✔️-owners of preferred shares must be paid before any
payment is made to common shareholders



-this is known as the dividend preference allotted to preferred shareholders. There
is no relationship between the amounts paid to preferred shareholders and common
shareholders.

To receive a dividend, the owner's name must appear in the transfer agent's books
by




4

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