Business > QUESTIONS & ANSWERS > STC SIE Practice Exams #'s 3 & 4 (QUESTIONS AND ANSWERS ) 2022/2023 (All)

STC SIE Practice Exams #'s 3 & 4 (QUESTIONS AND ANSWERS ) 2022/2023

Document Content and Description Below

If a brokerage firm creates an in-house, non-cash incentive program, it is permitted to be based on: A. The total amount of sales executed by the RR B. The specific type of product being sold by... the RR C. The most suitable products being sold by the RR D. Only the equity securities being sold by the RR - ANSWERA. The total amount of sales executed by the RR The person who distributes interest in a DPP is referred to as the: A. Distributor B. Syndicator C. Managing partner D. Limited partner - ANSWERB. Syndicator If an investor writes (sells) a covered call, what are the potential profit and loss outcomes? A. Unlimited profit and unlimited loss B. Unlimited profit and limited loss C. Limited profit and unlimited loss D. Limited profit and limited loss - ANSWERD. Limited profit and limited loss Municipal bond rating organizations are concerned primarily with the risk of: A. Declining purchasing power B. Market price fluctuations C. Default D. Illiquidity - ANSWERC. Default Which of the following organizations does NOT enforce MSRB rules? A. The Comptroller of the Currency B. FINRA C. The MSRB D. The SEC - ANSWERC. The MSRB The MSRB has no enforcement power. The SEC and FINRA enforce municipal regulations for broker-dealers. The Comptroller of the Currency, FRB, and FDIC enforce municipal regulations for dealer banks. The MSRB establishes its rules but has no enforcement powers. A corporation that has filed for bankruptcy is to be liquidated. Which of the following securities issued by that corporation has seniority in the liquidation process? A. Mortgage bonds B. Debenture bonds C. Common stock D. Participating preferred stock - ANSWERA. Mortgage bonds When a corporation is liquidated, its assets are sold and the proceeds are distributed. Secured creditors are paid first (i.e., mortgage bondholders), then unsecured creditors (debenture holders), then preferred stockholders, and last the common stockholders. This would make mortgage bonds the senior security of those listed. Which of the following recommendations will protect assets if there's an impending large market decline? A. Sell covered calls on all of the stocks in a portfolio B. Buy an S&P 500 ETF C. Move investments into cash and equivalents D. Invest in a managed large-cap growth fund - ANSWERC. Move investments into cash and equivalents Moving money into cash and equivalents (i.e., money-market securities) will provide investors with the most protection. Selling covered calls will generate some income, but will not provide protection over the short-term. A registered representative has just been appointed as a trustee for a trust that was established by her father-in-law. The trust was established for the benefit of the RR's spouse and dependent children. The registered representative will also receive a small fee for managing the trust. Which of the following best describes the registered representative's obligations under industry rules? A. Since this is an outside business activity, she must disclose the activity to her supervisors. B. She's violating industry rules since she cannot earn a fee for managing the trust. C. She has not violated any industry rules, sin [Show More]

Last updated: 2 years ago

Preview 1 out of 16 pages

Buy Now

Instant download

We Accept: