Series 6 Exam Questions with
Complete Solutions26
On the 2-year anniversary of their registration and every 3 years thereafter. - ANSWERS-When
must RRs complete the Regulatory Element of Continuing Education?
True - ANSWERS-True or False: Firm Element Continuing Education requires BDs to update
employees on job and product-related subjects.
U4 - ANSWERS-To apply for a securities license, one must file Form _____ with FINRA.
Action (buy/sell), Amount (quantity), and Asset (security) - ANSWERS-What three items must be
specified on a not held order
A not held order will be considered a day order. - ANSWERS-For how long may a not held order
be maintained?
The Trust Indenture Act of 1939 regulates corporate bond offerings (NOT municipal or
government offerings). - ANSWERS-The Trust Indenture Act of 1939 regulates
________________ offerings.
state and local tax. - ANSWERS-Though subject to federal tax, interest on Treasuries is exempt
from ________ and ________ tax.
True. The interest is taxed at the federal, state, and local level. - ANSWERS-True or False: Interest
paid on GNMA, FNMA, FHLMC, and SLMA agency bonds is fully taxable to investors.
,new issues. - ANSWERS-The Securities Act of 1933 regulates _____________.
Provide investors with full and fair disclosure regarding new issues (prospectus) - ANSWERS-
What is the primary purpose of the Securities Act of 1933?
False - ANSWERS-True or False: The SEC judges an offering's investment merit and provides
approval.
Government/municipal bonds, commercial paper, bankers' acceptances, bank issues, non-profit
and small business issues - ANSWERS-List the securities that are exempt from registration.
anti-fraud - ANSWERS-Though some securities are exempt from registration, nothing is exempt
from the ____________ provisions of the Act.
35 is the maximum number of non-accredited investors allowed in a Private Placement. -
ANSWERS-____ is the maximum number of non-accredited investors allowed in a Private
Placement.
Yes, so potential purchasers can provide indications of interest. - ANSWERS-May a preliminary
prospectus (red herring) be sent during the cooling-off period?
non-binding - ANSWERS-Indications of interest are _______________ on both the customer and
BD.
Return the check to the customer - ANSWERS-What should an RR do if a client sends a check to
purchase securities going through the cooling-off period?
True - ANSWERS-True or False: If a registration statement has not been filed with the SEC, BDs
may not discuss new issue information.
, final offering price - ANSWERS-The ____________________ will not appear in a red herring.
Blue-Sky Laws - ANSWERS-What rules govern the registration of an issue in any state in which it
will be offered?
true - ANSWERS-True or False: Blue-Sky Laws apply to broker-dealers and agents operating
within a state.
the syndicate. - ANSWERS-In a firm commitment underwriting, unsold securities are retained by
________________.
the issuer - ANSWERS-In a best-efforts underwriting, unsold securities are retained by
______________.
All-or-None - ANSWERS-What type of underwriting is cancelled if the entire issue is not sold?
Mini-max - ANSWERS-What type of underwriting is cancelled if a specified portion is not sold?
Stand-by - ANSWERS-A ___________ underwriting is used for shares not purchased through a
rights offering.
Stabilization - ANSWERS-____________ is the only form of price manipulation allowed by the
SEC.
False. Stabilization is designed to support or keep a new issue's price from falling. - ANSWERS-
True or False: Stabilization is designed to artificially raise the price of a new issue.
Complete Solutions26
On the 2-year anniversary of their registration and every 3 years thereafter. - ANSWERS-When
must RRs complete the Regulatory Element of Continuing Education?
True - ANSWERS-True or False: Firm Element Continuing Education requires BDs to update
employees on job and product-related subjects.
U4 - ANSWERS-To apply for a securities license, one must file Form _____ with FINRA.
Action (buy/sell), Amount (quantity), and Asset (security) - ANSWERS-What three items must be
specified on a not held order
A not held order will be considered a day order. - ANSWERS-For how long may a not held order
be maintained?
The Trust Indenture Act of 1939 regulates corporate bond offerings (NOT municipal or
government offerings). - ANSWERS-The Trust Indenture Act of 1939 regulates
________________ offerings.
state and local tax. - ANSWERS-Though subject to federal tax, interest on Treasuries is exempt
from ________ and ________ tax.
True. The interest is taxed at the federal, state, and local level. - ANSWERS-True or False: Interest
paid on GNMA, FNMA, FHLMC, and SLMA agency bonds is fully taxable to investors.
,new issues. - ANSWERS-The Securities Act of 1933 regulates _____________.
Provide investors with full and fair disclosure regarding new issues (prospectus) - ANSWERS-
What is the primary purpose of the Securities Act of 1933?
False - ANSWERS-True or False: The SEC judges an offering's investment merit and provides
approval.
Government/municipal bonds, commercial paper, bankers' acceptances, bank issues, non-profit
and small business issues - ANSWERS-List the securities that are exempt from registration.
anti-fraud - ANSWERS-Though some securities are exempt from registration, nothing is exempt
from the ____________ provisions of the Act.
35 is the maximum number of non-accredited investors allowed in a Private Placement. -
ANSWERS-____ is the maximum number of non-accredited investors allowed in a Private
Placement.
Yes, so potential purchasers can provide indications of interest. - ANSWERS-May a preliminary
prospectus (red herring) be sent during the cooling-off period?
non-binding - ANSWERS-Indications of interest are _______________ on both the customer and
BD.
Return the check to the customer - ANSWERS-What should an RR do if a client sends a check to
purchase securities going through the cooling-off period?
True - ANSWERS-True or False: If a registration statement has not been filed with the SEC, BDs
may not discuss new issue information.
, final offering price - ANSWERS-The ____________________ will not appear in a red herring.
Blue-Sky Laws - ANSWERS-What rules govern the registration of an issue in any state in which it
will be offered?
true - ANSWERS-True or False: Blue-Sky Laws apply to broker-dealers and agents operating
within a state.
the syndicate. - ANSWERS-In a firm commitment underwriting, unsold securities are retained by
________________.
the issuer - ANSWERS-In a best-efforts underwriting, unsold securities are retained by
______________.
All-or-None - ANSWERS-What type of underwriting is cancelled if the entire issue is not sold?
Mini-max - ANSWERS-What type of underwriting is cancelled if a specified portion is not sold?
Stand-by - ANSWERS-A ___________ underwriting is used for shares not purchased through a
rights offering.
Stabilization - ANSWERS-____________ is the only form of price manipulation allowed by the
SEC.
False. Stabilization is designed to support or keep a new issue's price from falling. - ANSWERS-
True or False: Stabilization is designed to artificially raise the price of a new issue.
