Question 1

Company ABC stock currently trades on an exchange. An ABC insider wants to sell a large number of shares of her privately held ABC stock. ABC files the necessary paperwork to register the shares, but the insider decides to wait and sell the stock at a later date. Which of the following terms best describes the type of offering that is occurring in this situation?

Options :

A : A rights offering

B : A private offering

C : An exempt offering

D : A secondary offering

Answer: D

Question 2

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 3

On settlement date, a customer is unable to pay for a purchase in his cash account. His position is liquidated. Which of the following statements is true according to Federal Reserve Regulation T?

Options :

A : Only closing transactions are permitted.

B : The customer is barred from trading for 30 days.

C : The customer-s account is frozen for 90 days.

D : All related accounts are frozen for 90 days.

Answer: C

Question 4

The formation of an asset-backed security or debt obligation that represents a claim on the cash flows from mortgage loans is known as:

Options :

A : Securitization

B : Hypothecation

C : Loan processing

D : Claim processing

Answer: A

Question 5

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