Series 7 STC Exam 2A With 100%
Correct Answers
A type of offering in which whatever is not sold is retained by the issuing corporation is:
a. A firm-commitment underwriting
b. A best-efforts underwriting
c. An all-or-none underwriting
d. A standby underwriting - CORRECT ANSWER✔✔b. A best-efforts underwriting
Which TWO of the following statements are TRUE of treasury stock?
I. It is stock that has been repurchased by a corporation
II. It receives dividends
III. It has voting rights
IV. It is listed on the company's balance sheet
a. I and II
b. II and III
c. I and IV
d. III and IV - CORRECT ANSWER✔✔c. I and IV
When a broker-dealer receives a confirmation of a trade from another member firm and has no
knowledge of the transaction, the broker-dealer will send a:
a. Complaint notice to FINRA
b. Complaint notice to the exchange where the transaction was executed
c. Don't know (DK) notice to the other member firm
, d. Notice to the clearing corporation that processed the trade - CORRECT ANSWER✔✔c. Don't
know (DK) notice to the other member firm
Mrs. Green enters an order to sell stock that is currently in her safe deposit box. According to
SEC rules, a broker-dealer must buy-in the stock if Mrs. Green does not deliver the shares
within:
a. 3 business days after the trade date
b. 3 business days after the settlement date
c. 10 business days after the trade date
d. 10 business days after the settlement date - CORRECT ANSWER✔✔d. 10 business days after
the settlement date
Which TWO of the following orders is a designated market maker (DMM) prohibited from
accepting on his book?
I. An open (GTC) order
II. A market order
III. A day order
IV. A not-held order
a. I and III
b. I and IV
c. II and III
d. II and IV - CORRECT ANSWER✔✔d. II and IV
When a broker-dealer is not acting for its own account but is making securities transactions for
the accounts of others, the firm is acting as a(n):
a. Broker
b. Principal
c. Underwriter
Correct Answers
A type of offering in which whatever is not sold is retained by the issuing corporation is:
a. A firm-commitment underwriting
b. A best-efforts underwriting
c. An all-or-none underwriting
d. A standby underwriting - CORRECT ANSWER✔✔b. A best-efforts underwriting
Which TWO of the following statements are TRUE of treasury stock?
I. It is stock that has been repurchased by a corporation
II. It receives dividends
III. It has voting rights
IV. It is listed on the company's balance sheet
a. I and II
b. II and III
c. I and IV
d. III and IV - CORRECT ANSWER✔✔c. I and IV
When a broker-dealer receives a confirmation of a trade from another member firm and has no
knowledge of the transaction, the broker-dealer will send a:
a. Complaint notice to FINRA
b. Complaint notice to the exchange where the transaction was executed
c. Don't know (DK) notice to the other member firm
, d. Notice to the clearing corporation that processed the trade - CORRECT ANSWER✔✔c. Don't
know (DK) notice to the other member firm
Mrs. Green enters an order to sell stock that is currently in her safe deposit box. According to
SEC rules, a broker-dealer must buy-in the stock if Mrs. Green does not deliver the shares
within:
a. 3 business days after the trade date
b. 3 business days after the settlement date
c. 10 business days after the trade date
d. 10 business days after the settlement date - CORRECT ANSWER✔✔d. 10 business days after
the settlement date
Which TWO of the following orders is a designated market maker (DMM) prohibited from
accepting on his book?
I. An open (GTC) order
II. A market order
III. A day order
IV. A not-held order
a. I and III
b. I and IV
c. II and III
d. II and IV - CORRECT ANSWER✔✔d. II and IV
When a broker-dealer is not acting for its own account but is making securities transactions for
the accounts of others, the firm is acting as a(n):
a. Broker
b. Principal
c. Underwriter
