SIE Exam - Finra Example Exam
Questions & Answers9
In which of the follow situations is an employee of a public company permitted to trade upon
information without violating insider trading laws - ANSWERS-An independent securities analyst
explains for the company next quarter could be markedly poorer than expected
Under rule 144A, an issuer of a restricted stock is permitted to sell to which of the following
investors - ANSWERS-Qualified Institutional Buyers (QIBs)
A registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take - ANSWERS-Send written notice to his supervisor
outlining the activity and compensation structure
Direct Participation Programs (DPP) provide: - ANSWERS-exposure to non-correlated assets with
steady returns
A decline is the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession - ANSWERS-2
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution - ANSWERS-A primary distribution involves a sale of
newly issued shares by the issuer while a secondary distribution involved the sale of already
issued and outstanding shares
A customer has a cash balance in her account together with long positions in several securities.
She has made no securities transactions in the account during the past 18 months. How often
must the firm send her an account statement - ANSWERS-Quarterly
, Which of the following communications with the public is considered misleading - ANSWERS-
Literature providing 10-year performance information to support predictions of future
performance
Which of the following form U4 reportable events results in a statutory disqualification -
ANSWERS-A felony conviction for a driving under the influence (DUI) charge
Which of the following investment risks is the greatest risk in a variable life insurance policy -
ANSWERS-Market risk
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding -
ANSWERS-Secured debt holder
Under FINRA rules, noncash compensation connected with the sale of variable contracts
includes all of the following items except: - ANSWERS-commisions
The redemption value of an open-end investment company shares is based on the - ANSWERS-
NAV computed after the order is received
The owner of which the following products is the most exposed to inflationary risk - ANSWERS-
Treasury bonds
Which of the following statements is true regarding a customer account held as tenants in
common - ANSWERS-The ownership for the decedent's assets is governed by their will or state
law
A customer buys 1 ABC Jan 35 put for a premium of $3 and simultaneously buys 100 shares of
ABC stock for $35 per share. The customer will break even when the stock is selling at what
price per share at expiration - ANSWERS-$38
Questions & Answers9
In which of the follow situations is an employee of a public company permitted to trade upon
information without violating insider trading laws - ANSWERS-An independent securities analyst
explains for the company next quarter could be markedly poorer than expected
Under rule 144A, an issuer of a restricted stock is permitted to sell to which of the following
investors - ANSWERS-Qualified Institutional Buyers (QIBs)
A registered representative (RR) wants to participate in a private securities transaction. Which
of the following actions must the RR take - ANSWERS-Send written notice to his supervisor
outlining the activity and compensation structure
Direct Participation Programs (DPP) provide: - ANSWERS-exposure to non-correlated assets with
steady returns
A decline is the gross domestic product (GDP) must last for at least how many quarters to be
considered a recession - ANSWERS-2
Which of the following comparisons best describes the essential difference between a primary
distribution and a secondary distribution - ANSWERS-A primary distribution involves a sale of
newly issued shares by the issuer while a secondary distribution involved the sale of already
issued and outstanding shares
A customer has a cash balance in her account together with long positions in several securities.
She has made no securities transactions in the account during the past 18 months. How often
must the firm send her an account statement - ANSWERS-Quarterly
, Which of the following communications with the public is considered misleading - ANSWERS-
Literature providing 10-year performance information to support predictions of future
performance
Which of the following form U4 reportable events results in a statutory disqualification -
ANSWERS-A felony conviction for a driving under the influence (DUI) charge
Which of the following investment risks is the greatest risk in a variable life insurance policy -
ANSWERS-Market risk
Which of the following stakeholders has first claim priority in a Chapter 11 proceeding -
ANSWERS-Secured debt holder
Under FINRA rules, noncash compensation connected with the sale of variable contracts
includes all of the following items except: - ANSWERS-commisions
The redemption value of an open-end investment company shares is based on the - ANSWERS-
NAV computed after the order is received
The owner of which the following products is the most exposed to inflationary risk - ANSWERS-
Treasury bonds
Which of the following statements is true regarding a customer account held as tenants in
common - ANSWERS-The ownership for the decedent's assets is governed by their will or state
law
A customer buys 1 ABC Jan 35 put for a premium of $3 and simultaneously buys 100 shares of
ABC stock for $35 per share. The customer will break even when the stock is selling at what
price per share at expiration - ANSWERS-$38
