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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Seeks Business for the Broker-Dealer from Customers and Potential Customers | 9% | - Customer acquisition and prospecting
|
| Topic 2: Provides Customers with Information About Investments, Makes Suitable Recommendations, Transfers Assets and Maintains Appropriate Records | 73% | - Investment products
|
| Topic 3: Opens Accounts After Obtaining and Evaluating Customers' Financial Profile and Investment Objectives | 11% | - Customer accounts and documentation
|
| Topic 4: Obtains and Verifies Customers' Purchase and Sale Instructions and Agreements; Processes, Completes and Confirms Transactions | 7% | - Trade execution and settlement
|
1. A wealth investor gives Bubba discretion to invest $50,000 for him in any way Bubba sees fit. Therefore,
Bubba must:
A) be registered with the NYSE and FINRA as a representative
B) conform to the prudent man requirements in that state
C) furnish written documents of authority to the brokerage firm executing the orders
D) a registered representative with the SEC under the Investment Advisors Act of 1940
2. Which of the following sets out the details for the management board of condominiums, including the
board's powers and limitations?
A) bylaws
B) loan agreement
C) master deed
D) rental agreement
3. Which of the following is true about a customer with a frozen account?
A) must deposit the full purchase cost before an order is executed
B) may not trade corporate securities under any circumstances
C) must deposit sufficient cash for each transaction no later than the settlement date
D) may make purchases but not sales of corporate securities
4. The return by the receiving party of securities previously accepted for delivery or a demand by the
delivering party for return of securities that have been delivered is called:
A) re-delivery
B) rejection
C) reclamation
D) close-out
5. If a customer fails to pay for securities purchased in a cash account, the member firm broker will do which
of the following?
A) liquidate the securities or otherwise cancel the transaction
B) purchase the securities for the firm's error account
C) grant an extension for a bona fide reason
D) place the securities temporarily in a general account
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: A | Question # 3 Answer: A | Question # 4 Answer: C | Question # 5 Answer: A |
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