SIE Unit 1

All of the following are self-regulatory organizations (SROs)...

-FINRA -MSRB -NYSE/CBOE

For those who follow monetary theory, which is the most complete measure of the money supply?

M3

All of the following are self-regulatory organizations (SROs) EXCEPT...

SEC

Broker-dealers and registered representatives may be subject to each of the following administrative and regulatory bodies EXCEPT...

SIPC

A prospectus displays which of the following...

description of how the proceeds will be used

Which of the following is considered to be the order of the stages in a business cycle?

expansion, peak, contraction, trough

Restricted persons are not allowed to purchase an IPO of common stock. All of the following are restricted persons EXCEPT...

the grandparent of a restricted person

Broker-dealers and registered representatives may be subject to each of the following administrative and regulatory bodies...

-FINRA -State Securities Administrator -NYSE/CBOE

All of the following SROs function under the SECs oversight...

-MSRB -FINRA -CBOE

Each of the following provides for an exemption from the registration requirements of the Securities Act of 1933...

-Regulation A+ -Regulation D -Rule 147

The US balance of payments deficit would decrease in all of the following scenarios...

-a decrease in dividend payments by US companies to foreign investors -a decrease in imports of foreign goods into the US -an increase in exports of domestic goods from the US

All of the following are associated with being a carrying firm...

-accepting customer securities -being able to clear customer transactions -accepting customer funds

To stimulate the economy during a recession y expanding the availability of credit, the FRB would do any of the following...

-buy US government securities in open market operations -lower the reserve requirement -lower the discount rate

The transfer agent for a corporation is responsible for each of the following...

-cancelling old and issuing new certificate -maintaining ownership records -ensuring that its securities are issued int eh correct owner's name

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

-carrying firms -the Depository Trust Company -the National Securities Clearing Corporation

Broker-dealers must comply with SEC rules and regulations when conducting business. A broker-dealer that does not comply may be subject to all of the following...

-censure -fines -suspension or revocation of its registration

All of the following are benefits of using a Prime broker...

-consolidation of records -cost savings -multiple executing brokers

The Federal Reserve Board (FRB) does all of the following...

-determine monetary policy -supervise the printing of currency -regulate and impact the money supply

The Federal Reserve Board (FRB) might impact the money supply by using all of the following...

-discount rate -reserve requirements for member banks -buying or selling securities in open market

Assets offered and traded int eh securities markets can include all of the following...

-equities -derivative products -currencies

All of the following are TRUE regarding the "term" market...

-it can be a physical place or an electronic venue -it is where buyers and sellers come together for the purpose of trading assets -it includes stock exchanges

An offering is defined as the sale of a security. Regarding the offerings, all of the following are TRUE...

-offerings can be identified by who is selling the securities issuer or investor -offerings of bonds can be made to the investing public -offerings of stocks can be made for the investing public

A registered securities broker-dealer that does not comply with FINRA and SEC rules and regulations is subject to each of the following sanctions...

-partial or full suspension of its registration -limits on activities, functions, or operations -censure

The Securities Act of 1933 protects investors who buy new issues by doing all of the following...

-regulating the underwriting and distribution of primary and secondary issues -requiring an issuer to provide full and fair disclosure -providing criminal penalties for fraud in the issuance of new securities

Downturns in the business cycle or economic contraction are characterized by all of the following...

-rising numbers of bond defaults -higher consumer debt -rising numbers of bankruptcies

To prevent inflation by tightening the availability of credit, the FRB would do any of the following...

-sell US government securities in open-market operations -raise the reserve requirement -raise the discount rate

Which fo the following WILL be found in a final prospectus?

-statement that the SEC neither approves nor disapproves of the issue -business plan and use of proceeds -effective date and offering price

Each of the following may be traded on an exchange...

-stocks (equities securities) -bonds (debt securities) -options (derivative securities)

Some institutions can function as a depository and intermediary for settling transactions between buyers and sellers of securities. All of the following are acceptable for this purpose...

-the Depository Trust Company -the National Securities Clearing Corporation -carrying firms

A tombstone advertisement would be expected to include all of the following information...

-the name of the issuer and underwriters if they are being used to assist in the offering -an advisory that the advertisement is neither an offer to sell nor a solicitation of an offer for any of these securities -the price or price range at which the securities are expected to be offered

An underwater is placing a tombstone advertisement for a company's new issue. A prospective investor might expect to see all of the following information on the advertisement...

-the names of the underwriting members -the type of security to be sold (stock or bond) -the number of shares to be sold

Regarding the registration statement filed with the SEC, when new securities are to be issued, all of the following are TRUE...

-underwriters may assist the issuer in preparing and filing the registration statement -the names and addresses of company officers and directors, their salaries, and a 5-year business history of each must be shown -a description of how the proceeds raised form the sale will be used must be disclosed

The securities Act of 1933 requires that all of the following buffered by a prospectus...

-variable annuities -mutual fund shares -unit investment trusts

After the issuer files a registration statement with the SEC, the time known as the cooling-off period begins. This allows a registration to become effective as early as...

20 calendar days after the date the SEC has received it

For non-listed and non-NASDAQ securities, the prospectus for an APO must be provided to all those who purchase securities for how many days after the effective date?

40

Large time deposits of more than $100,000 are considered to be found in what part of the money supply?

M3

Shelf offerings are covered under which of the following?

The Securities Act of 1933

A strong US dollar leads to more...

US imports and a balance of payments deficit

The law that provides the legal framework for state registration of securities is the...

Uniform Securiteit Act

A company's board of directors has agreed that the company should be prepared to have shares of common stock ready to be issued that are intended to be distributed in the form of a one-time employee bonus. Not knowing exactly when the one-time employee bonus plan will be implemented and the shares will be needed, the tie of registration or offering that will best suit the scenario is...

a "shelf" registration

A broker-dealer that accepts funds and securities form customers and its correspondent member firms would most likely be which fo the following?

a carrying firm

During the cooling off period of a new registration filed with the SEC...

a red herring may be given to prospective investors

Each of the following provides for an exemption from the registration requirement of the Securities Act of 1933 EXCEPT...

access equals delivery rule

Which of the following will NOT be found in a final prospectus?

agreement among underwriters

A corporation sells shares to the investing public in order to raise capital. This is known as...

an issuer transaction

Tombstone ads...

are permitted before the effective date

To expand the overall economy, the Federal Reserve Board, acting's agent for the US Treasury Department, will...

buy securities via open-market operations, pushing interest rates down

A clearing corporation agent or depository for securities transactions...

can be a commercial bank

A corporation needs to build a new manufacturing facility costing several hundred million dollars. In which of the following markets could this new capital be raised?

capital market

The best characterization of how economists view the money supply is...

cash, loans, different forms of credit, and other liquid instruments

When the Federal Open Market Committee (FOMC) directs that treasury securities be sold in the open market, this...

decreases the money supply

Which of the following points to a general decline in prices occurring during severe recessions and the unemployment rate is rising?

deflation

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

firm committment

Laws increasing or decreasing taxation would be best associated with...

fiscal policy enacted by the President and Congress

During periods of economic decline and contraction, one would expect...

gross domestic product (GDP) to decrease

When investors buy and sell securities to and form one another, these transactions occur...

in the secondary market

The prime rate is set by...

individual banks

Rising employment due to an increase in demand for goods and services would be associated with periods of?

inflation

When the money supply in the economy increases...

interest rates go down, hence borrowing and spending for consumers is easier

A broker-dealer's business model allow for only the purchase and sale of securities for retail customer accounts. It does not execute, settle, or clear its customer's transactions, nor does it tend to any back office functions such as sending trade confirmations or forwarding proxies. This broker-dealer would best be described as what type of firm?

introducing/fully disclosed

Which of the following is TRUE regarding the primary market?

issuer transactions occur in the primary market

For the primary market, which of the following is TRUE?

issuer transactions occur int he primary market and securities are offered at a public offering price

An underwriting group is currently assisting an issuer with the preparation and filing of the registration statements for a new issue. Who is responsible for the accuracy of the information within the registration statement?

issuing corporation

An investor requests a preliminary prospectus for a new issue. Regarding the document which of the following is TRUE?

it is made available between the registration date and the effective date

Assets offered and traded in the securities markets can include all of the following EXCEPT...

life insurance

Each of the following may be traded on an exchange EXCEPT...

life insurance

All of the following are exempt from the Securities ACT of 1933 EXCEPT...

limited partnership

The statement "These securities have not been approved or disapproved nor have ay representations been made about the accuracy of the adequacy of the information" is...

mandated to be in the final prospectus by the SEC

There are two distinctive types of policies implemented to shape and mold the US economy. They are...

monetary and fiscal

Which fo the following securities is exempt from the Securities Act of 1933?

municipal note

Some institutions can function as a depository and intermediary for selling transactions between buyers and sellers of securities. All of the following are acceptable for this purpose EXCEPT...

national banks

In the capital markets, securities such as stocks and bonds can be...

offered by both public and private sectors

State registration is not required if the transaction is exempt. An example of an exempt transaction would be...

one that is unsolicited

The business cycle includes all of the following classifications...

peak, trough, expansionistson, contraction

Just as markets can be influenced by many factors, so can the market price of a single company's stock. While all of the following could impact a company's stock price to some extent, which would be the least likely to have a direct and immediate impact?

political elections

A company is looking to raise additional capital to fund an expansion plan. The company's senior management chooses to issue additional bonds to the general public. The best expression to explain this type of offering would be a(n)...

primary offering

Which of the following offerings is most likely exempt from the registration requirements of the Securities Act of 1933?

private (nonpublic) securities offerings

Regarding the registration of securities with the Securities Exchange Commission, which of the following is TRUE?

private securities offerings are generally exempt from registration

A bank is likely to do which of the following when The Federal Reserve Board (FRB) tightens the money supply...

raise its prime rate

To tighten its monetary policy, making it more difficult for consumers to borrow money, the Federal Reserve Board can...

raise the discount rate

All of the following are benefits of using a prime broker EXCEPT...

research

If it finds that the registration statement need revision, expansion, or to have corrections made, the SEC may suspend the review of the new issue and issue a deficiency letter. Once the issuer submits a corrected registration statement, the 20 day cooling off period...

resumes where it had left off

For nonexempt securities being offered to the public for the first time by a corporate issuer, which of the following would be applicable?

securities act of 1933 regulating issues that must be offered by prospectus

The Uniform Securities Act (USA) provides a legal framework for the registration of...

securities at the state level

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

self-clearing

The rate at which banks lend to broker-dealers for the purpose of lending money for margin loans is typically...

slightly above (a percentage point or so) other short-tea lending rates

Federal Reserve member banks needing to borrow money can borrow from...

the Federal Reserve Bank at the discount rate

The federal law requiring co's offering public equity or debt securities to provide a prospectus to investors is known as...

the Securities Act of 1933

If the US dollar is relatively strong against the Japanese yen, it can be assumed that...

the US dollar will buy more goods produced in Japan, while the Japanese yen busy fewer goods produced in the US

The largest component of the US balance of payments is...

the balance of trade

A customer of a FINRA member firm buys securities on margin. The customer is expected to pay a rate of interest on the margin loan based on which of the following?

the broker call loan rate

The broker loan rate charged by banks is also known as...

the call loan rate

A customer has a significant amount of money in bank deposit accounts: $225,000 in a savings account titled in the customer's name; $240,000 in a checking account titled jointly with a spouse and $100,000 in an account where the customer is custodian for a grandchild. Should that bank fail, the Federal Deposit Insurance Corporation (FDIC) insurance would cover...

the entire $565,000

The rate that commercial money center banks charge each other for overnight loans is...

the federal funds rate

The prospectus delivery requirement, access equals delivery, is satisfied when...

the final prospectus has been filed with the SEC and is available not he SEC's website for investors to see

When the Federal Reserve Board (FRB) utilizes the tools available to it, it is influencing...

the money supply

Securities regulations that are called blue-sky laws refer to those at...

the state level

All of the following are TRUE of tombstone advertisements EXCEPT...

they are mandatory and must be placed during the cooling off period