Series 6 - STC Greenlight Exam 2025
With 100% Correct Answers
An investor asks a registered representative to underline the most important facts found in a
preliminary prospectus. The registered representative:
A) May not do this since it violates federal securities laws
B) May do this with the approval of a principal at the firm
C) May do this with the approval of FINRA
D) May do this without restrictions or approvals - CORRECT ANSWER✔✔A) May not do this
since it violates federal securities laws
Once a prospectus is filed with the SEC, it may not be amended in any way.
Listed below are the net asset value and offer prices of two investment companies:
Net Asset Value:
Fund A - $9.20
Fund B - $12.50
Offer Price:
Fund A - $10.00
Fund B- $12.00
Based upon the information shown above, you can determine that:
A) Both funds are open-end
B) Both funds are closed-end
,C) A is closed-end and B is open-end
D) B is definitely closed-end and A is probably open-end - CORRECT ANSWER✔✔D) B is
definitely closed-end and A is probably open-end
When the net asset value is higher than the offering price, the fund definitely is closed-end.
Closed-end funds have a price determined by supply and demand, and their prices may be more
or less than the net asset value per share, while open-end funds are prohibited from ever selling
their shares for less than the net asset value. Thus Fund B, which has an offering price less than
its net asset value, must be a closed-end fund, while Fund A could be either.
Cash dividends declared by a corporation:
A) Must be approved for payment by the shareholders
B) Must be approved for payment by the board of directors
C) Are taxed as capital gains
D) Are not taxed - CORRECT ANSWER✔✔B) Must be approved for payment by the board of
directors
Cash dividends declared by a corporation must be approved by the corporation's board of
directors. Shareholder approval is not needed to declare a cash dividend, although a company
must obtain shareholder approval for a stock split.
Any cash dividends paid to shareholders are taxed as ordinary income in the year received, not
capital gains.
A customer calls to lodge a complaint against a registered representative (RR). The customer
should be advised to:
A) Call FINRA
B) Call the RR
, C) Call the appropriate principal
D) Put the complaint in writing - CORRECT ANSWER✔✔D) Put the complaint in writing
In order to be officially considered a complaint, the complaint should be put in writing. This
mandates an appropriate response from the member firm.
A Regulation D offering may be sold to a maximum of:
A) 15 nonaccredited investors
B) 15 accredited investors
C) 35 nonaccredited investors
D) 35 accredited investors - CORRECT ANSWER✔✔C) 35 nonaccredited investors
A Regulation D (private placement) offering may be sold to a maximum of 35 nonaccredited
investors. There is no limit on the number of accredited investors. An individual will be
considered an accredited investor if he has a net worth of $1,000,000 or has had $200,000
($300,000 for a married couple) of income for the previous two years with an anticipation of
continued earnings at the same or a greater level.
A fee-based account is most suitable for customers who:
A) Have discretionary accounts
B) Utilize a buy-and-hold strategy
C) Engage in frequent trading
D) Are unsure of which investments will best meet their objectives - CORRECT ANSWER✔✔C)
Engage in frequent trading
With 100% Correct Answers
An investor asks a registered representative to underline the most important facts found in a
preliminary prospectus. The registered representative:
A) May not do this since it violates federal securities laws
B) May do this with the approval of a principal at the firm
C) May do this with the approval of FINRA
D) May do this without restrictions or approvals - CORRECT ANSWER✔✔A) May not do this
since it violates federal securities laws
Once a prospectus is filed with the SEC, it may not be amended in any way.
Listed below are the net asset value and offer prices of two investment companies:
Net Asset Value:
Fund A - $9.20
Fund B - $12.50
Offer Price:
Fund A - $10.00
Fund B- $12.00
Based upon the information shown above, you can determine that:
A) Both funds are open-end
B) Both funds are closed-end
,C) A is closed-end and B is open-end
D) B is definitely closed-end and A is probably open-end - CORRECT ANSWER✔✔D) B is
definitely closed-end and A is probably open-end
When the net asset value is higher than the offering price, the fund definitely is closed-end.
Closed-end funds have a price determined by supply and demand, and their prices may be more
or less than the net asset value per share, while open-end funds are prohibited from ever selling
their shares for less than the net asset value. Thus Fund B, which has an offering price less than
its net asset value, must be a closed-end fund, while Fund A could be either.
Cash dividends declared by a corporation:
A) Must be approved for payment by the shareholders
B) Must be approved for payment by the board of directors
C) Are taxed as capital gains
D) Are not taxed - CORRECT ANSWER✔✔B) Must be approved for payment by the board of
directors
Cash dividends declared by a corporation must be approved by the corporation's board of
directors. Shareholder approval is not needed to declare a cash dividend, although a company
must obtain shareholder approval for a stock split.
Any cash dividends paid to shareholders are taxed as ordinary income in the year received, not
capital gains.
A customer calls to lodge a complaint against a registered representative (RR). The customer
should be advised to:
A) Call FINRA
B) Call the RR
, C) Call the appropriate principal
D) Put the complaint in writing - CORRECT ANSWER✔✔D) Put the complaint in writing
In order to be officially considered a complaint, the complaint should be put in writing. This
mandates an appropriate response from the member firm.
A Regulation D offering may be sold to a maximum of:
A) 15 nonaccredited investors
B) 15 accredited investors
C) 35 nonaccredited investors
D) 35 accredited investors - CORRECT ANSWER✔✔C) 35 nonaccredited investors
A Regulation D (private placement) offering may be sold to a maximum of 35 nonaccredited
investors. There is no limit on the number of accredited investors. An individual will be
considered an accredited investor if he has a net worth of $1,000,000 or has had $200,000
($300,000 for a married couple) of income for the previous two years with an anticipation of
continued earnings at the same or a greater level.
A fee-based account is most suitable for customers who:
A) Have discretionary accounts
B) Utilize a buy-and-hold strategy
C) Engage in frequent trading
D) Are unsure of which investments will best meet their objectives - CORRECT ANSWER✔✔C)
Engage in frequent trading
