Andrew study ****

Under the de minimis exemption, an initial public offering of common stock may be sold to an account where restricted persons have a beneficial interest as long as their interest in the account does not exceed

10%

The Big Shoe Sneaker Company is a small manufacturer of athletic shoes. It is selling $100 million of its stock. This will be its first public offering. It will use the money to enhance both marketing and production with a plan to grow the business and obtain a Nasdaq listing in two or three years. After the initial sale of the new shares, buyers of the stock in the over-the-counter market should expect to receive the final prospectus for how many days?

90

The aftermarket prospectus requirement for the IPO of nonlisted securities is

90 days

Trading hours on the New York Stock Exchange are

9:30-4:00

Underwriters acting as principals and committing to purchase any unsold shares for the syndicate account would BEST be described as being engaged in

Firm commitment

Which of the following prospectus delivery requirements for negotiable securities sold in the secondary markets is not accurate?

For an additional issue if the security is non-Nasdaq there is no delivery requirement.

If a bond is purchased at a discount, the yield to maturity is

Higher than the nominal yield

With money market securities, the risks are

I. a lower return than with longer-term instruments. IV. the potential reinvestment of principal at different rates over short periods of time.

An example of securities that are established by states to provide other government entities such as cities, towns, school districts or state agencies with a short-term investment vehicle to invest funds include

LGIPS

An investor with no other positions in LMN stock purchases 600 shares at the market. This investor is

Long LMN stock and bullish

A broker-dealer designated as a carrying firm would be expected to do all of the following except

Maintain a lower 9N non-caring broker dealers

A corporation increases capitalization by selling shares of stock which can either come from a new issue or previously authorized but unissued shares. Total stock outstanding must

Never exceed the number of shares authorized

Indications of interest taken during the cooling off period are

Non binding on the issuer and underwriters and nonbinding on the investor

Correspondent firms would be likely to have relationships with which of the following types of broker-dealers?

Self-clearing

A market maker

Trade in a proprietary account to facility trading of security and provide liquidity

The Securities Act of 1933 requires that

a new issue, unless specifically exempted from the Act, be registered with the Securities and Exchange Commission (SEC) before public sale.

If a customer sold puts to open, which of the following transactions would be allowed if the options agreement was not returned signed within 15 days?

buy puts to close

All of the following are false descriptions of different securities offering types except

in a primary additional issue, underwriting proceeds go to the issuer.

During the cooling-off period, underwriters may not:

Advertise the issue

T-bonds are delivered in

Book entry

Federal, state, and local income tax would be due on the interest from which of the following issues?

GNMA certificate

A company, in order to raise capital for expansion, wants to sell shares of stock to investors. The company's common stock is not currently trading in the secondary market. This offering is known as

IPO

A shelf registration

Is good for two years requires a suplemental prospectus

Which of the following accurately characterizes capital risk?

It can be reduced by diversification.

associated person is unable to work for any business other than his member firm without having the employing broker-dealer's

Knowledge of the activity

Shelf coverings are covered under

The securities act of 1933

The ratings on the debt instruments of a foreign country with outstanding loans from a number of other countries worldwide have been downgraded. The impact felt due to the risk of possible default is known as

sovereign risk

For collateral trust bonds, all of the following are true except

these are unsecured debt securities

A registered representative speaks to a customer about a particular 6% municipal bond quoted on a 6.5% basis. Which of the following is correct? 1. 6% is the bond's coupon. II. 6% is the bond's current yield. III. 6.5% is the bond's yield to maturity. IV. 6.5% is the bond's current yield.

1 & 2

Which of the following would be applicable to nonexempt securities (those that must be registered) being offered to the public by a corporate issuer? I. Securities Act of 1933 II. Prospectus III. Securities Act of 1934 IV. Secondary market

1 & 2

A company is already public with several major stockholders. The company proposes an offering where sale proceeds for shares being sold to the investing public will go to some of the existing stockholders who want to divest of their shares as well as to the corporation. This is 1. a combination offering. II. a primary offering. III. a secondary offering. IV. an initial primary offering (IPO).

1 only (a combination offering)

All of the following are acceptable choices to function as a depository and intermediary for transactions between buyers and sellers of securities except

Credit unions

Narcissus, Inc., a social media company, has shares selling at $50. Your customer is bearish. He would like to sell the stock short, but not until it retreats at least 10% from its current price. In order to catch the drop he could

Enter a sell short at stop 45

Ensuring that the investing public is fully informed about a security and its issuing company when shares are first sold in the primary market is covered under which of the following federal acts?

Securities Act of 1933

State registration is not required. If the transaction is exempt, an example of an exempt transaction would be.

One that is unsolicited

The shares of a corporation that have been issued to shareholders, less any shares held in treasury, are called the

Outstanding shares

Which of the following entities considers appeals of decisions made in department of enforcement (DOE) actions?

The National Adjudicatory Council (NAC)

The largest component of the U.S. balance of payments is

The balance of trade

Accomplishing gauging in as securities offering that is a combination of a primary and secondary offering, which of the following is true

The combination is known as a split offering where the issue receives some of the proceeds and existing shareholders receive some of the proceeds from the sale

A registered representative is introducing options terminology to a client. Of the following, which explanation regarding owners and writers of listed equity option call contracts would be true?

The owner of a call has the right to exercise the contract, and the writer would then be assigned and obligated to sell shares to the owner at the strike price.

Sandal manufacturer Achilles, Inc., had registered to sell shares of its stock to the public for the first time. The company has several different uses for the money to be raised-first among them is the building of a new manufacturing plant outside of Troy, Michigan. This sale would be

The primary market