An investor tells his rr to purchase 50m EGG 11.7% debenture bonds. The order goes
through and the bonds are purchased for 113. A year before the bond matures, it is valued
at 103. What is this called? - ANSWER Amortization
In oil and gas limited partnerships is the risk greater in developmental or exploratory pro-
grams? - ANSWER exploratory
What is the best way to measure the GNP? (gross national product) - ANSWER constant
dollars
What is the broker's role in the term "broker/dealer"? - ANSWER executing trades for cli-
ent accounts
What is the maximum federal tax rate for corporations on their dividends and other income?
- ANSWER 35%
What is the maximum federal tax rate for individuals on their dividends and other income? -
ANSWER 20%
What type of securities are exempt from registration under the Securities Act of 1933? - AN-
SWER government agency issues
Suppose a put is assigned to the writer. Under federal guidlines, the premium received by
the writer of the put is treated in what manner? - ANSWER It is subtracted from the cost
basis when the writer is assigned
1
,How much income must a REIT generate from the real estate properties? - ANSWER 75%
How much must a REIT pass-through of its profits to investors? - ANSWER 90%
A portfolio manager of a pension fund desires income but wants to protect the porfolio.
What option position would he make? - ANSWER Write calls against the market index for
income and protection.
A rr should request an extension of time for an invest to pay for stock that he has purchased
by the: - ANSWER Fifth business day
Self-employed people can contribute how much to thier Keogh? - ANSWER The lesser of
100% of their income or $51,000
Your customer thinks that the stock is aobut to hit the resistance level and break through to
the next level. She would like to take advantage of the situation. Whay type of ORDER would
you suggest she place? - ANSWER Buy Stop order
When an investor buys a corporate bond, they have how many days to pay for it? - AN-
SWER 3 business days
What are the rating agencies for ST, LT and Muni Debt Securities? - ANSWER 1. S&P
2. Moody's
3. Fitch's
4. Best's
What does Best's Rating service rate? - ANSWER they are the one rating company that
rates insurance companies instead of bonds
2
, How are CDs issued? - ANSWER in bearer form only
Where are CDs shown and for how long? - ANSWER on Nasdaq with a minimum duration
of 14 days
How are CDs quoted? - ANSWER in terms of yield
Who does not issue eurodollar deposits? - ANSWER US government
What kind of taxes is the interest of corporate bonds subject to? - ANSWER federal in-
come tax and state income tax
If a zero-coupon bond is held for one year and sold above its original value, the investor will
have? - ANSWER ordinary income and capital gain
If a zero-coupon bondholder hold it until maturity they will have no? - ANSWER no capi-
tal gain
What type of muni note does not get rated by MIG because they are backed by a govern-
ment bond? - ANSWER CLNs
What does a bond indenture NOT include? - ANSWER re-offering yields
What is required before a revenue bond can be issued? - ANSWER feasibility study and
engineering report
What must a muni bond being issued obtain from a bond counsel? - ANSWER legal opin-
ion
3
through and the bonds are purchased for 113. A year before the bond matures, it is valued
at 103. What is this called? - ANSWER Amortization
In oil and gas limited partnerships is the risk greater in developmental or exploratory pro-
grams? - ANSWER exploratory
What is the best way to measure the GNP? (gross national product) - ANSWER constant
dollars
What is the broker's role in the term "broker/dealer"? - ANSWER executing trades for cli-
ent accounts
What is the maximum federal tax rate for corporations on their dividends and other income?
- ANSWER 35%
What is the maximum federal tax rate for individuals on their dividends and other income? -
ANSWER 20%
What type of securities are exempt from registration under the Securities Act of 1933? - AN-
SWER government agency issues
Suppose a put is assigned to the writer. Under federal guidlines, the premium received by
the writer of the put is treated in what manner? - ANSWER It is subtracted from the cost
basis when the writer is assigned
1
,How much income must a REIT generate from the real estate properties? - ANSWER 75%
How much must a REIT pass-through of its profits to investors? - ANSWER 90%
A portfolio manager of a pension fund desires income but wants to protect the porfolio.
What option position would he make? - ANSWER Write calls against the market index for
income and protection.
A rr should request an extension of time for an invest to pay for stock that he has purchased
by the: - ANSWER Fifth business day
Self-employed people can contribute how much to thier Keogh? - ANSWER The lesser of
100% of their income or $51,000
Your customer thinks that the stock is aobut to hit the resistance level and break through to
the next level. She would like to take advantage of the situation. Whay type of ORDER would
you suggest she place? - ANSWER Buy Stop order
When an investor buys a corporate bond, they have how many days to pay for it? - AN-
SWER 3 business days
What are the rating agencies for ST, LT and Muni Debt Securities? - ANSWER 1. S&P
2. Moody's
3. Fitch's
4. Best's
What does Best's Rating service rate? - ANSWER they are the one rating company that
rates insurance companies instead of bonds
2
, How are CDs issued? - ANSWER in bearer form only
Where are CDs shown and for how long? - ANSWER on Nasdaq with a minimum duration
of 14 days
How are CDs quoted? - ANSWER in terms of yield
Who does not issue eurodollar deposits? - ANSWER US government
What kind of taxes is the interest of corporate bonds subject to? - ANSWER federal in-
come tax and state income tax
If a zero-coupon bond is held for one year and sold above its original value, the investor will
have? - ANSWER ordinary income and capital gain
If a zero-coupon bondholder hold it until maturity they will have no? - ANSWER no capi-
tal gain
What type of muni note does not get rated by MIG because they are backed by a govern-
ment bond? - ANSWER CLNs
What does a bond indenture NOT include? - ANSWER re-offering yields
What is required before a revenue bond can be issued? - ANSWER feasibility study and
engineering report
What must a muni bond being issued obtain from a bond counsel? - ANSWER legal opin-
ion
3
