1. All broker-dealers need to maintain customer identification programs and should check the names of all new clients against

a list maintained by the SEC

a list compiled by FINRA

a do-not-call list maintained by the firm

a list of specially designated nationals (SDNs) maintained by OFAC

If one of your clients wants to order municipal securities that you believe to be unsuitable for her investment objectives, what should you do?

You must obtain the permission of the firm's compliance officer before executing the order.

You may execute the order as long as you mark the order ticket as "unsolicited."

You may only execute the order with the prior permission of a principal of the firm.

You must refuse the order unless the client changes her investment objectives.

If Buddy Seagull has a limited amount of funds and wants to invest in the pharmaceutical industry but does not want to limit his investments to only one or two companies, which type of fund would be MOST suitable?

A hedge fund

A sector fund

A balanced fund

A money-market fund

The ex-date is

the date on which the corporation ceases paying a dividend

the third business day before the record date

the date on and after the date the seller is entitled to the dividend

the day the stock price is increased by the amount of the dividend

Adjustable-rate preferred stock has a dividend that adjusts according to

the rate on CMOs

prevailing interest rates

the coupon rate on the issuer's bonds

the amount of dividend given to common stockholders

Skippy Barrier III has 1,000 shares of DIM common stock in his portfolio. Skippy would like to protect himself in the event that the market price ofDIM drops. Which of the following orders would best meet Skippy's needs?

A buy limit order

A buy stop order

A sell stop order

A sell limit order

The SEC and FINRA require customer statements to be sent out for inactive accounts at least

semiannually

monthly

quarterly

annually

Variable annuities must be registered with the

I. Department of State

II. State Banking Commission

III. State Insurance Commission

IV. Securities and Exchange Commission

I and II

I and III

I and IV

III and IV

All of the following are important factors when determining the markup or commission on a municipal bond trade EXCEPT

the fact that you and the firm you work for are entitled to make a profit

the difficulty of the trade

the 5-percent markup policy

the market value of the securities at the time of the trade

According to MSRB rules, customer confirmation must include

the markup or markdown

the location of the indenture

the maturity date

whether the trade was done on an agency or dealer basis

Investing in a real-estate DPP program includes which of the following advantages?

I. Depreciation

II. Appreciation

III. Depletion

IV. Cash flow

I, II, and IV

I, II, III, and IV

I and II

III and IV

Which of the following items are found on an indenture of a bond?

I. The maturity date

II. Callable or convertible features

III. The coupon rate

IV. The name of the trustee

I, II, and III

I, II, III, and IV

II, III, and IV

II and III

Prior to buying or selling options, a customer must first receive a(n)

margin agreement

ODD

OPRA

OCC

When compared to statutory voting, cumulative voting provides an advantage to

I. larger shareholders

II. mortgage bondholders

III. smaller shareholders

IV. convertible bondholders

II and III

II and IV

III only

I only

A registered representative may open all of the following customer account EXCEPT

an account in the name of Mr. Wegner for Mrs. Wegner

a corporate account by a designated officer

a partnership account by a designated partner

a minor's account by a custodian

Which of the following occurs under the provisions of the Uniform Gifts to Minors Act (UGMA) when a minor reaches the age of majority?

The account must be transferred to the donor.

The account is closed, and the new adult receives a check in the amount equal to the market value of the account less any commission.

The account is automatically changed to a UTMA account.

The account must be transferred to the donee after she reaches adulthood.

Which of the following have ownership positions in a corporation?

I. Convertible bondholders

II. Convertible preferred stockholders

III. Common stockholders

IV. Mortgage bondholders

II and IV

II only

I, II, III, and IV

II and III

If a customer wants to open a new account but refuses to provide some of the financial information requested by the member firm, which of the following statements is TRUE?

The firm may open the account if it can determine from other sources that the customer has the financial means to handle the account.

The firm may open the account and take unsolicited trades only.

The firm may open the account for the customer and make recommendations freely.

The firm may not accept any trades for the account until the information is received from the customer.

Common stockholders of PXPX Corporation have which of the following rights and privileges?

The right to vote for stock dividends to be paid

The right to receive an audited financial report weekly

The right to vote for cash dividends to be paid

A residual claim to assets at the dissolution

A customer's confirmation must include.

I.the markdown, if the member acted as a principal for a listed security

II. the amount of any commission, if the member acted as an agent

III. whether the member acted as an agent or a principal

IV. the markup if the member acted as a principal for a listed security

I, II, III, and IV

I and III

I, III, and IV

II and IV

Which of the following statements regarding municipal revenue bonds is NOT true?

Revenue bonds may be issued by interstate authorities.

Revenue bonds are not subject to a debt ceiling.

The maturity date of the issue will usually exceed the useful life of the facility backing the bonds.

Debt service is paid from revenue received from the facility backing the bonds.

Mutual funds must send financial statements to shareholders at least

monthly

quarterly

semiannually

bimonthly

An investor buys 100 shares of common stock of T-Prompters, Inc. at $15per share. Six months later, T-Prompter Inc. is trading at 12.40-12.65, and the registered representative offers to purchase the 100 shares back from the investor for his own account at $14.25 per share. This procedure is

permitted with the written permission of a manager of the firm

prohibited because it violates the Code of Procedure

prohibited because it is a guarantee against a loss

permitted by FINRA rules

One of your clients is expecting to receive a lot of money over the next three years. Your client would like to shelter some of that money by investingin a DPP. Which of the following types of DPPs will help your clientshelter the most money?

Oil and gas combination

Oil and gas developmental

Oil and gas wildcatting

Oil and gas income

Which of the following is true of accredited investors?

They have a net worth of at least $1,000,000, excluding any equity, they have in their primary residence.

They have had an annual income in excess of $200,000 for at least the last three years.

They have a net worth in excess of $200,000.

They have had an annual income in excess of $100,000 for at least the last two years.

Which of the following establishes the U.S. Treasury Department as the regulator for anti-money-laundering programs?

The Bank Secrecy Act

None of the provided answers are correct

OFAC

SDN

Which of the following are needed to open a margin account for a corporation?

I. Corporate charter and resolution

II. New account form

III. Hypothecation agreement

IV. Credit agreement

III and IV

I and II

I and IV

I, II, III, and IV