SIE EXAM- UNIT 1 (KNOWLEDGE OF
CAPITAL MARKETS) QUESTIONS &
ACCURATE ANSWERS PASSED 100%
Securities and exchange commission is the securities industry's primary regulatory
body. - Correct Answer ✔✔ SEC-
The securities exchange act of 1934 - Correct Answer ✔✔ Which act created the SEC?
If you conduct securities business with either customers or broker dealers; you must be
apply and be approved for registration with the SEC - Correct Answer ✔✔ What is the
purpose of registering with the SEC
It regulates all exchanges and trading markets - Correct Answer ✔✔ Additional role of
the SEC
Annually - Correct Answer ✔✔ Under the Uniform Securities act, registrations must be
renewed how frequently?
Commonly known as the Securities and Exchange Commission's disclaimer, the SEC
mandates that it be found in the final prospectus. - Correct Answer ✔✔ The statement
"These securities have not been approved or disapproved nor have any representations
been made about the accuracy or the adequacy of the information" is found where
Censure, limits on activities, functions, or operations.
Suspension or revocation of registration
Fine - Correct Answer ✔✔ What happens a when a broker dealer does not comply with
SEC rules
Function under SEC's oversight. Each SRO is accountable to the commission for
enforcing federal securities as well as supervising securities practices within assigned
jurisdiction (FINRA, CBOE, MSRB) - Correct Answer ✔✔ Self Regulatory Organizations
(SROs)
Financial Industry Regulatory Authority- More or less they regulate all matters related to
investment banking (securities underwriting, trading in the OTC Market, trading in
NYSE-listed securities and conduct of their member firms - Correct Answer ✔✔ FINRA
1. Promote the investment banking and securities business
2.promote high standards of commercial honor
3. Provide a medium for communication among its members and between members,
the govt/other agencies
, 4. Enforce rules to prevent fraud and manipulative practices - Correct Answer ✔✔
Purpose and objective of FINRA
Chicago Board options exchange- regulates all matters related to trading standarized
options and related contracts listed on that exchange - Correct Answer ✔✔ CBOE
Municipal securities Rulemaking Board- Regulates all matters related to the
underwriting and trading of state and municipal securities. Regulates but does not
enforce, that's where other SROs like FINRA come in. - Correct Answer ✔✔ MSRB
Oversee the collection of taxes. This dept is administered by the secretary of the
treasury - Correct Answer ✔✔ Dept of treasury
Internal Revenue service- Collects taxes and enforces tax laws - Correct Answer ✔✔
IRS
North American Securities Administrators association-
This is a voluntary association whose members provide their unique insight to the SEC
and SROS as they move forward in the rulemaking process.
Advocates for pro-investors policies, offer resources to its communities. - Correct
Answer ✔✔ NASAA
Consists of 12 regional federal reserve banks and hundreds of national and state banks
that belong to the system. - Correct Answer ✔✔ Federal Reserve board
The federal reserve board
1. acts as an agent of the U.S treasury
2.Regulates the U.S money supply
3.Supervise the printing of currency
4. Make sure members are compliant with federal regulations - Correct Answer ✔✔
What is the role of FRB
Securities Investor Protection Corp. was created under the securities investor protection
act of 1970 - Correct Answer ✔✔ Which act created the SIPC
Securities Investor Protection Corp- is a nonprofit membership organization. protects
the clients of brokerage firms that are forced into bankruptcy. - Correct Answer ✔✔
SIPC
No more than $500,000 per separate customer not per account. Of that $500,000 total
SIPC covers no more than $250,000 in cash - Correct Answer ✔✔ Basic coverage
under SIPC
The customer becomes a general creditor of the broker-dealer - Correct Answer ✔✔
What happens if a broker dealer fails and a customer with claims that are in excess of
SIPC coverage
CAPITAL MARKETS) QUESTIONS &
ACCURATE ANSWERS PASSED 100%
Securities and exchange commission is the securities industry's primary regulatory
body. - Correct Answer ✔✔ SEC-
The securities exchange act of 1934 - Correct Answer ✔✔ Which act created the SEC?
If you conduct securities business with either customers or broker dealers; you must be
apply and be approved for registration with the SEC - Correct Answer ✔✔ What is the
purpose of registering with the SEC
It regulates all exchanges and trading markets - Correct Answer ✔✔ Additional role of
the SEC
Annually - Correct Answer ✔✔ Under the Uniform Securities act, registrations must be
renewed how frequently?
Commonly known as the Securities and Exchange Commission's disclaimer, the SEC
mandates that it be found in the final prospectus. - Correct Answer ✔✔ The statement
"These securities have not been approved or disapproved nor have any representations
been made about the accuracy or the adequacy of the information" is found where
Censure, limits on activities, functions, or operations.
Suspension or revocation of registration
Fine - Correct Answer ✔✔ What happens a when a broker dealer does not comply with
SEC rules
Function under SEC's oversight. Each SRO is accountable to the commission for
enforcing federal securities as well as supervising securities practices within assigned
jurisdiction (FINRA, CBOE, MSRB) - Correct Answer ✔✔ Self Regulatory Organizations
(SROs)
Financial Industry Regulatory Authority- More or less they regulate all matters related to
investment banking (securities underwriting, trading in the OTC Market, trading in
NYSE-listed securities and conduct of their member firms - Correct Answer ✔✔ FINRA
1. Promote the investment banking and securities business
2.promote high standards of commercial honor
3. Provide a medium for communication among its members and between members,
the govt/other agencies
, 4. Enforce rules to prevent fraud and manipulative practices - Correct Answer ✔✔
Purpose and objective of FINRA
Chicago Board options exchange- regulates all matters related to trading standarized
options and related contracts listed on that exchange - Correct Answer ✔✔ CBOE
Municipal securities Rulemaking Board- Regulates all matters related to the
underwriting and trading of state and municipal securities. Regulates but does not
enforce, that's where other SROs like FINRA come in. - Correct Answer ✔✔ MSRB
Oversee the collection of taxes. This dept is administered by the secretary of the
treasury - Correct Answer ✔✔ Dept of treasury
Internal Revenue service- Collects taxes and enforces tax laws - Correct Answer ✔✔
IRS
North American Securities Administrators association-
This is a voluntary association whose members provide their unique insight to the SEC
and SROS as they move forward in the rulemaking process.
Advocates for pro-investors policies, offer resources to its communities. - Correct
Answer ✔✔ NASAA
Consists of 12 regional federal reserve banks and hundreds of national and state banks
that belong to the system. - Correct Answer ✔✔ Federal Reserve board
The federal reserve board
1. acts as an agent of the U.S treasury
2.Regulates the U.S money supply
3.Supervise the printing of currency
4. Make sure members are compliant with federal regulations - Correct Answer ✔✔
What is the role of FRB
Securities Investor Protection Corp. was created under the securities investor protection
act of 1970 - Correct Answer ✔✔ Which act created the SIPC
Securities Investor Protection Corp- is a nonprofit membership organization. protects
the clients of brokerage firms that are forced into bankruptcy. - Correct Answer ✔✔
SIPC
No more than $500,000 per separate customer not per account. Of that $500,000 total
SIPC covers no more than $250,000 in cash - Correct Answer ✔✔ Basic coverage
under SIPC
The customer becomes a general creditor of the broker-dealer - Correct Answer ✔✔
What happens if a broker dealer fails and a customer with claims that are in excess of
SIPC coverage
