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Last Updated: Sep 04, 2026
No. of Questions: 400 Questions & Answers with Testing Engine
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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Provides Customers with Information about Investments, Makes Suitable Recommendations, Transfers Assets and Maintains Appropriate Records | 73% | - Equity securities - Direct participation programs - Investment companies, ETFs, and variable annuities - Debt securities and government obligations - Municipal securities - Options and derivative products - Margin accounts and taxation - Recordkeeping and regulatory reporting |
| Topic 2: Seeks Business for the Broker-Dealer from Customers and Potential Customers | 7% | - Product-specific disclosures and regulatory requirements - Standards for advertising and public communications - Customer communication and solicitation rules |
| Topic 3: Obtains and Verifies Customers’ Purchase and Sales Instructions; Processes, Completes and Confirms Transactions | 11% | - Order types and execution procedures - Trade settlement and confirmation rules - Regulatory requirements for transaction processing |
| Topic 4: Opens Accounts after Obtaining and Evaluating Customers’ Financial Profile and Investment Objectives | 9% | - Suitability rules and regulatory compliance - Account types and documentation requirements - Financial profile, risk tolerance, and investment objectives |
Question 1
What expression is used to describe the application of income and revenues derived from the operation of
a facility financed from proceeds of a revenue bond?
A. flow of funds
B. debt service
C. revenue funding
D. disbursement of priorities
Question 2
Bubba is buying a treasury bill. The discount he receives results in Bubba's determination of:
A. yield to call
B. face value
C. nominal yield
D. rate of return
Question 3
Which of the following option positions is indicative of the same class of option?
A. long one XYZ July 70 put and one XYZ July 70 call
B. long one XYZ October 20 call and one XYZ January 30 call
C. short one XYZ June 40 call and one ABC June 20 call
D. short one XYZ February 60 put and one ABC February 60 put
Question 4
Which of the following statements regarding mutual funds is true?
A. the custodian can also be the transfer agent
B. the sponsor receives a management fee based on the fund's totalassets
C. the management company receives a portion of the sales load for managing the fund assets
D. the terms "management company" and "investment advisor" are interchangeable
Question 5
Regulation T is set at 50%. Bubba's account contains long positions in the following securities with the
prices listed
1 00 ABC $30
2 00 XYZ $70
2 00 QBB $40
2 00 KKK $25
Total market value = $30,000
Debit balance in the account = $12,000
Net equity balance of the account = $18,000
Bubba wants to buy 100 shares of DUM at $30 per share and 100 shares of OUT at $120. How much how
much value of additional securities must Bubba deposit in lieu of depositing cash?
A. $3,000
B. $6,000
C. $9,000
D. $15,000
Solutions:
| Question 1 Answer: A | Question 2 Answer: D | Question 3 Answer: B | Question 4 Answer: A | Question 5 Answer: C |
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