SIE Part 2
When a bank lends money to a broker-dealer for the purpose of lending to margin account customers, the bank is lending at which of the following rates?
Broker call loan
Which of the following is considered to be the order of the stages in a business cycle?
Expansion, peak, contraction, trough
Which of the following organizations engaging in open-market operations acts as agent for the U.S. Treasury Department?
Federal Reserve Board (FRB)
A surplus in the U.S. balance of payments can occur if I) interest rates in foreign countries are higher than U.S. domestic rates II) interest rates in foreign countries are lower than U.S. domestic rates III) U.S. consumers are purchasing (importing) foreign goods IV) foreign consumers are purchasing (importing) U.S. goods
II and IV
During the cooling-off period, underwriters of new securities may I) accept orders to purchase shares II) not accept orders to purchase shares III) not accept indications of interest regarding potential purchases of shares IV) accept indications of interest regarding potential purchases of shares
II and IV
Which of the following is a lagging indicator?
Increase in the consumer loans to personal income ratio
Where can demand deposits, checking accounts, paper currency and coins be found in the money supply?
M1, M2, and M3
For those who follow monetary theory, which is the most complete measure of the money supply?
M3
Different degrees of inflation can impact the economy differently. Which of the following best reflects this?
Mild inflation can encourage growth and stimulate the economy
Which of the following is a leading indicator?
New orders for consumer goods
The federal government could use which of the following to slow the economy?
Raise taxes
A final prospectus contains all of the following except
SEC approval
Which of the following companies was created by an act of Congress and provides securities investors limited financial coverage in the event that the investor's servicing broker-dealer fails financially?
Securities Investor Protection Corporation (SIPC)
Which of the following would take place in the primary market?
Securities sold to the public by the issuer
When the economy shows high unemployment and is failing to expand as measured by a lack of consumer demand and business activity, but prices for goods and services are still rising, this could be described as what?
Stagflation
Which of the following refers to prolonged periods of slow or little economic growth, usually accompanied by high unemployment?
Stagnation
Which of the following entities considers appeals of decisions made in department of enforcement (DOE) actions?
The National Adjudicatory Council (NAC)
The ATOP Company is planning to offer shares of both common and preferred stock to the investing public in order to raise operating capital intended to be used for expansion. Which of the following laws enacted by Congress would be the most relevant when issuing these equity securities to the public?
The Securities Act of 1933
Regarding primary offerings, which of the following is true?
There is no limit to the number of primary offerings a corporation can issue
The U.S. balance of payments deficit would decrease in all of the following scenarios except
a decrease in purchases of U.S. securities by foreign investors
A tombstone announcement may contain all of the following except
an offer to sell the securities
A company that offers sales of another company's securities would best be described as
an underwriter
The SEC can do all of the followingexcept
approve broker-dealers to participate in the securities business
Regarding registration for the sale of securities, those registered under the Investment Company Act of 1940, such as mutual funds, would be considered
federal covered securities and not required to register at the state level
A measure of a nation's citizen's economic activity is
gross national product
A preliminary prospectus is used to solicit
indications of interest before the effective date
Mrs. Jones is an employee of a member firm and as such is a restricted person regarding the purchase of new issues. She belongs to an investment club and has a 1% interest in the club's brokerage account. The investment club
is not a restricted account and will be allowed to purchase equity shares of an initial public offering (IPO)
All the following are exempt from the Securities Act of 1933 except
limited partnership
A preliminary prospectus (red herring)
may be used to gather indications of interest
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 except
national banks
Regarding the registration statement filed with the Securities and Exchange Commission (SEC) when new securities are to be issued, all of the following are true except
the accuracy and adequacy of the registration documents is the responsibility of the underwriters
A broker-dealer and its associated persons may be subjected to sanctions for violations of the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) rules. Which of the following penalties can be levied against the associated persons?
Censure
Which of the following best fits the description of a growth stock?
Common shares in companies that retain earnings and pays little or no dividends
