Question 1

Assuming yields are held constant, which of the following statements describes what will occur as a discount bond reaches maturity?

Options :

A : Its price increases.

B : Its price decreases.

C : Its par value increases.

D : Its par value decreases.

Answer: A

Question 2

The civil penalty for an individual who is convicted of an insider trading violation is permitted to be an amount up to how many times the profit gained or loss avoided?

Options :

A : 1 time

B : 3 times

C : 6 times

D : 10 times

Answer: B

Question 3

A municipal securities dealer makes a political contribution of $990 to a local mayoral candidate. At the end of the quarter, to whom, if anyone, must the dealer report the contribution?

Options :

A : SEC

B : MSRB

C : FINRA

D : No disclosure required as the amount is below the reporting threshold

Answer: B

Question 4

Shares in a private investment in public equity (PIPE) offering are priced:

Options :

A : At the current market value per share.

B : Below the current market value per share.

C : Above the current market value per share.

D : At the public offering price (POP) as determined by the underwriters.

Answer: B

Question 5

A registered representative must complete which of the following activities when entering a discretionary trade?

Options :

A : Only exercise discretion over market orders

B : Indicate that discretion was exercised on the order ticket to be identified for supervisory review

C : Obtain authorization from the customer before each discretionary order is entered

D : Receive instructions from the customer as to the price at which to buy or sell a security

Answer: B