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Series 79 Questions

187 Questions
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  • 1. 
    Who are options created by?
    • A. 

      Issuer

    • B. 

      O.C.C

  • 2. 
    If Disqualified from registration, you can file ______ for a hearing
    • A. 

      14b-9

    • B. 

      Mc-400

    • C. 

      10b-18

    • D. 

      Nyse rule 44

  • 3. 
    Who needs a series 7 as well as a series 79?
  • 4. 
    How long does a special inactive last for after discharge?
    • A. 

      120 days

    • B. 

      2 years

    • C. 

      2 years + 90 day grace period

    • D. 

      10 years

  • 5. 
    After receiving notice, how long do you have to complete your regulatory element?
    • A. 

      180 days

    • B. 

      120 days

    • C. 

      2 years

  • 6. 
    • A. 

      Every 2 years

    • B. 

      2 years after registration, every 3 years after that

    • C. 

      Every 3 years

    • D. 

      3 years after registration, every 2 years after that

  • 7. 
    Which best describes front running?
    • A. 

      Wash sales

    • B. 

      Trading ahead of client orders

    • C. 

      Pegging

    • D. 

      Capping

  • 8. 
    When Pegging, you
    • A. 

      Keep the price of a stock from rising

    • B. 

      Keep the price of a stock from falling

  • 9. 
    When Capping, you
    • A. 

      Keep the price from falling

    • B. 

      Keep the price from rising

  • 10. 
    A u-5 must be submitted within
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      30 days

  • 11. 
    How long do you have for the transgression of a felony or misdemeanor?
    • A. 

      180 days

    • B. 

      2 years

    • C. 

      5 years

    • D. 

      10 years

  • 12. 
    True or false: If you work in public finance, you are considered a RR
    • A. 

      True

    • B. 

      False

  • 13. 
    True or False: if you work for the DPP you are considered a Registered Rep
    • A. 

      True

    • B. 

      False

  • 14. 
    What is the waiting period for unsuccessful attempts on the series 79
    • A. 

      30 days after 1st and 2nd attempt 180days every time after

    • B. 

      30 days between each test

    • C. 

      30 days after 1st,2nd and 3rd attempt, 180 days each time after

  • 15. 
    Which best describes the Securities exchange act of 1934?
    • A. 

      Created by Finra, regulates bonds

    • B. 

      Created by Finra, regulates secondary markets

    • C. 

      Created by SEC, Regulates bonds

    • D. 

      Created by SEC, Regulates secondary market

  • 16. 
    What are the penalties for an individual who commits a criminal crime and who regulates it?
    • A. 

      Up to $25mm - SEC

    • B. 

      Up to $5m and 20 years in jail regulated by DOJ

    • C. 

      Must give up profits and up to 3 times the profit SEC

    • D. 

      Must give up profits and up to 3 times the profit DOJ

  • 17. 
    What are the penalties for an individual who commits a civil crime? Who regulates this?
    • A. 

      Give up profits and up to 3 times the amount- SEC

    • B. 

      Give up profits and up to 3 times the amount - DOJ

    • C. 

      Up to $5m and 20 years in jail regulated by DOJ

    • D. 

      Up to $25 regulated by DOJ

  • 18. 
    • A. 

      Give up profits and up to 3 times the amount- SEC

    • B. 

      Give up profits and up to 3 times the amount - DOJ

    • C. 

      Up to $5m and 20 years in jail regulated by DOJ

    • D. 

      Up to $25 regulated by DOJ

  • 19. 
    A company wants to buy back stocks, what section must he abide by? 
    • A. 

      Section 3011

    • B. 

      Section 10b-18

    • C. 

      Section 10b-5

    • D. 

      435(5)

  • 20. 
    Who files a WSP and how often?
    • A. 

      BOD annually

    • B. 

      BOD quarterly

    • C. 

      CEO annually

    • D. 

      CEO quarterly

  • 21. 
    A client buys an IPO, they get a prospectus and a confirmation in the mail. Which document does the investment bank keep and how long are they required to keep it?
    • A. 

      Both Documents 2 years

    • B. 

      Confirmation 3 years

    • C. 

      Confirmation 2 years

    • D. 

      Prospectus 3 years

  • 22. 
    • A. 

      Quarterly

    • B. 

      Semi-annually

    • C. 

      Annually

  • 23. 
    Which best describes OSJ?
    • A. 

      Structures Public Offers

    • B. 

      Signs off on company literature

    • C. 

      Structures private placements

    • D. 

      All of the above

  • 24. 
    An OSJ, must be supervised by an
    • A. 

      Officer

    • B. 

      Owner of 10% or more

    • C. 

      Principle

    • D. 

      Shareholder

  • 25. 
    True or False: The Patriot act backs CIP? 
    • A. 

      True

    • B. 

      False

  • 26. 
    Under CIP, you must check the name of a foreign client against which list
    • A. 

      Opac

    • B. 

      Ofac

    • C. 

      Sars

    • D. 

      SEC

  • 27. 
    If you suspect a foreign client of having $5k or more in undeclared money, what is required?
    • A. 

      File under SEC within 10 days

    • B. 

      File under SARs within 10 days

    • C. 

      File under SEC within 30 days

    • D. 

      File under SARs within 30 days

    • E. 

      File under Ofac within 30 days

  • 28. 
    If you notice a foreign country such as syria or north korea attempting to do business, what action must be taken.
    • A. 

      Block & Report to OFAC 10 days

    • B. 

      Block & Report OFAC 30 days

    • C. 

      Block & Report SARs 10 days

    • D. 

      Block & Report SARs 30 days

  • 29. 
    Trading securities outside the regular scope of employement is regulated by Finra, as well as the approval of a member. Another word for this is:
    • A. 

      Pegging

    • B. 

      Wash Sale

    • C. 

      Selling away

    • D. 

      Cross selling

  • 30. 
    • A. 

      Yes

    • B. 

      No

  • 31. 
    Client XYZ wants to share his losses and profits with you, is it possible?
    • A. 

      Yes

    • B. 

      Yes, with a joint account only

    • C. 

      Not at all

  • 32. 
    How often are customer complaints files and with who?
    • A. 

      Finra Annually

    • B. 

      Finra Quarterly

    • C. 

      SEC Annually

    • D. 

      SEC Quarterly

  • 33. 
    A change in statements, projections on revenue or expenses or a change to historical documents are called: 
    • A. 

      8-k statements

    • B. 

      Pro-forma statements

  • 34. 
    What is the statue of limitations for arbitration?
    • A. 

      2 years

    • B. 

      5 years

    • C. 

      6 years

    • D. 

      10 years

  • 35. 
    Companies exceeding $10mm and more than 500 shareholders must register and file
    • A. 

      Section 10b-18

    • B. 

      Regulation FD

    • C. 

      10k & 10Q

    • D. 

      8K

  • 36. 
    How often are 10Qs Filed a year?
    • A. 

      Once

    • B. 

      Twice

    • C. 

      Three times

    • D. 

      Four times

  • 37. 
    After material information changes, what time frame is given to file an 8-k
    • A. 

      4 Business Days

    • B. 

      4 calendar days

    • C. 

      10 Business Days

    • D. 

      10 Calender days

  • 38. 
    If material non public information is disclosed improperly, it must be disseminated to the public under what rule and what time limit?
    • A. 

      Regulation FD 120 Days

    • B. 

      Regulation FD 24 Hours

  • 39. 
    • A. 

      True

    • B. 

      False

  • 40. 
    True or False, an officer, director or owner of more than 10% of voting securities is considered an insider.
    • A. 

      True

    • B. 

      False

  • 41. 
    When acheiving insider status, what form must be file and how long
    • A. 

      Form 4 - 2 Business days

    • B. 

      Form 3 - 10 days

    • C. 

      Form 2 - 5 days

    • D. 

      Form 5 - Annually

  • 42. 
    Annual filings covering transactions such as gifts are filed under which form?
    • A. 

      Form 4 - 2 business days

    • B. 

      Form 3- 10 business days

    • C. 

      Form 5 - Annually

    • D. 

      Form 2 - Annually

  • 43. 
    Notification to the SEC of changes in position are filed in what form and when?
    • A. 

      Form 4 - 2 business days

    • B. 

      Form 3- 10 business days

    • C. 

      Form 5 - Annually

    • D. 

      Form 2 - Annually

  • 44. 
    Anyone who acquired 5% or more of equity must file
    • A. 

      Schedule 13d

    • B. 

      14d-9

    • C. 

      13a-11

    • D. 

      10b-5

  • 45. 
    When filing a schedule 13d-9, who must you file it with
    • A. 

      The issuer

    • B. 

      The exchange where security is traded

    • C. 

      The SEC

    • D. 

      A and C only

    • E. 

      A, B and C

  • 46. 
    If a man is looking to purchase a 5% of Google but doesn't intend on controlling or influencing the stock, what must he file?
    • A. 

      Schedule 13d-9

    • B. 

      Schedule TO in addition to schedule 13d-9

    • C. 

      Schedule 13G

    • D. 

      Schedule 13F

  • 47. 
    Institutional investment managers file what form quarterly?
    • A. 

      Schedule 13D

    • B. 

      Schedule 13G

    • C. 

      Schedule 13F

  • 48. 
    Time Period for Annual Proxy Meeting by mail is 
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      30 days

    • D. 

      40 days

  • 49. 
    Time Period for Annual proxy meeting by electronic notice
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      30 days

    • D. 

      40 days

  • 50. 
    A preliminary proxy statement must be filed how long before a definitive proxy?
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      30 days

    • D. 

      40 days

  • 51. 
    What form would you use for the Registration of an IPO
    • A. 

      Form 3

    • B. 

      Form 4

    • C. 

      Form S-3

    • D. 

      Form S-1

  • 52. 
    The registration form used for IPO over 75 mm public float is:
    • A. 

      Form S-1

    • B. 

      Form 1

    • C. 

      Form 3

    • D. 

      Form S-3

    • E. 

      Form 4

  • 53. 
    Once the SEC approves the preliminary proxy, the company can than send the definitive proxy to the shareholders and the SEC this is known as the
    • A. 

      One Step Merger

    • B. 

      Two Step Merger

    • C. 

      Tender Offer

  • 54. 
    When a company first issues a Tender Offer than files for a short form Merger, its called
    • A. 

      Tender Offer

    • B. 

      Two Step Merger

    • C. 

      Short form Registration

    • D. 

      Selling away

  • 55. 
    If one wanted to use a form to find out everything they needed to know about a merger, what form would they use?
    • A. 

      Form S-1

    • B. 

      Form S-3

    • C. 

      Schedule 13e-3

    • D. 

      Form S-4

  • 56. 
    Google is going to purchase its own securities back, in the process its going to either cause the company to be delisted or no longer be a reporting company, what must they file?
    • A. 

      Schedule 13d-9

    • B. 

      Schedule 13e-3

    • C. 

      Schedule 14d-9

    • D. 

      Schedule TO

  • 57. 
    If John makes a tender offer which causes him to own 6% of the share what must he file
    • A. 

      Schedule TO

    • B. 

      Schedule TO in addition to schedule 13d-9

    • C. 

      Schedule TO in addition to Schedule 14d-9

  • 58. 
    • A. 

      Schedule 13d-9

    • B. 

      Schedule TO in addition to Schedule 13d-9

    • C. 

      Schedule TO

    • D. 

      Schedule 14-9

  • 59. 
    John makes a tender offer one april 5th, on April 6th the TO was amended, how long must the offer be kept open for in total? 
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      29 days

    • D. 

      19 days

  • 60. 
    True or False. John bought made a TO with Google, He is allowed to continue trading Google's stock.
    • A. 

      True

    • B. 

      False

  • 61. 
    When making a TO, how long does the subject company have to notify and advise shareholders?
    • A. 

      10 business days

    • B. 

      30 business days

    • C. 

      120 business days

    • D. 

      180 business days

  • 62. 
    How long does the terminating company have to submit a u-5?
    • A. 

      10 days

    • B. 

      20 days

    • C. 

      30 days

    • D. 

      120 days

  • 63. 
    After a u-5 how long does one have before they re-qualify?
    • A. 

      20 days

    • B. 

      30 days

    • C. 

      120 days

    • D. 

      After 1 year

    • E. 

      After 2 years

  • 64. 
    An options contract that gives the holder the right to sell a certain quantity at a specific price up to a certain date is known as a 
    • A. 

      Call

    • B. 

      Put

    • C. 

      Right

    • D. 

      Warrent

  • 65. 
    Dividends are determined by
    • A. 

      Officer

    • B. 

      Principle

    • C. 

      BOD

    • D. 

      Shareholders

  • 66. 
    Jakey has 1,000 shares in google. Google decides that this year everyone will have statutory voting rights. They are voting for 5 directors. How many votes does Jakey have?
    • A. 

      1,000 votes

    • B. 

      2,000 votes

    • C. 

      3,000 votes

    • D. 

      4,000 votes

    • E. 

      5,000 votes

  • 67. 
    • A. 

      1,000 votes

    • B. 

      2,000 votes

    • C. 

      3,000 votes

    • D. 

      4,000 votes

    • E. 

      5,000 votes

  • 68. 
    Which type of shares provides shareholders with the ability to maintain a precentage of ownership and the short term right to buy below market value?
    • A. 

      Warrents found in Common stock

    • B. 

      Rights found in common stock

    • C. 

      Warrants found in preferred stock

    • D. 

      Rights found in preferred stock

  • 69. 
    A Security that allows the holder to buy shares of common stock at a preset price, typically at a premium is known as a 
    • A. 

      Right found in common stock

    • B. 

      Right found in preferred stock

    • C. 

      Warrant found in common stock or bond

    • D. 

      Warrant found in preferred stock or bond

  • 70. 
    Short term investments offered to shareholders at a discount
    • A. 

      Rights

    • B. 

      Warrants

  • 71. 
    Long term investments offered at a premium
    • A. 

      Rights

    • B. 

      Warrants

  • 72. 
    On april 6th 2010 google announces its going to begin trading its stock with dividends, this is known as:
    • A. 

      Payment Date

    • B. 

      Record Date

    • C. 

      Declaration Date

    • D. 

      Ex-dividend date

  • 73. 
    True or false: the BOD decide on Ex-dividend dates.
    • A. 

      True

    • B. 

      False

  • 74. 
    Which is the correct order of the dividend dates?
    • A. 

      1)ex-dividend 2)record 3)declaration 4)Payment

    • B. 

      1)Declaration 2)Record 3)ex-dividend date 4)payment

    • C. 

      1)Declaration 2)ex-dividend 3)record 4)payment

  • 75. 
    The issuer has the ability to repurchase a stock, typically at a premium, what type of stock is this an example of?
    • A. 

      Putable stock

    • B. 

      Callable Stock

    • C. 

      Rights

    • D. 

      Warrents

  • 76. 
    • A. 

      Callable stock

    • B. 

      Putable stock

    • C. 

      Preferred stock

    • D. 

      Participating stock

  • 77. 
    Stock appreciation rights (SARs) are issued by who and benefit who by providing the right to receive the difference between market value and fixed price
    • A. 

      Issued by company benefits investors

    • B. 

      Issued by stockholders benefits issuers

    • C. 

      Issued by company, benefits employees

  • 78. 
    • A. 

      Stock Appreciation Rights

    • B. 

      Employee Stock Options

  • 79. 
    ______________ are foreign securities held in a us bank located in a foreign country. Typically provide common shares that pay dividends in us currency and can be either sponsored or not sponsored. 
    • A. 

      American Depository Receipts

    • B. 

      Global Depository Receipts

  • 80. 
    An investor is looking for information on an unsponsored company such as Nintendo, where can he look? 
    • A. 

      Pink Sheets & OTCBB

    • B. 

      8k

    • C. 

      10-q

    • D. 

      All of the above

    • E. 

      None of the above

  • 81. 
    If an ADR is sponsored, who pays for it?
    • A. 

      The issuer

    • B. 

      Stockholders

    • C. 

      Broker Dealers

  • 82. 
    If an ADR is non-sponsored who is responsible for payment?
    • A. 

      The Issuer

    • B. 

      The Broker Dealer

    • C. 

      Shareholders

  • 83. 
    Can a GDR be offered in the united states
    • A. 

      Yes, its still a GDR

    • B. 

      Yes, it will be considered an ADR

    • C. 

      No, doesnt meet requirements

  • 84. 
    An example of a fixed income investment is
    • A. 

      A common stock

    • B. 

      A preferred stock

    • C. 

      A Bond

  • 85. 
    The par value of a bond is $1,000. The interest of a bond pays 1 point. how much interest is received?
    • A. 

      $1.00

    • B. 

      $10.00

    • C. 

      $100.00

    • D. 

      $1,000.00

  • 86. 
    Ms. jones owns a 5% bond, how much does she receive annually?
    • A. 

      $5

    • B. 

      $50

    • C. 

      $500

    • D. 

      $.50

  • 87. 
    • A. 

      $20

    • B. 

      $1,000

    • C. 

      $1200

    • D. 

      $1300

  • 88. 
    • A. 

      $1200

    • B. 

      $25

    • C. 

      $40

    • D. 

      $30

    • E. 

      $50

  • 89. 
    • A. 

      Convert Stock

    • B. 

      Accept call-in price

  • 90. 
    When quoting a yield, how much does 1% represent?
    • A. 

      1% = 1 point

    • B. 

      1% = 100 basic points

    • C. 

      1%= 10 points

  • 91. 
    What is the CURRENT YIELD, if the Nominal Yield is 8% and the bond price is $1,000
    • A. 

      2%

    • B. 

      4%

    • C. 

      6%

    • D. 

      8%

    • E. 

      10%

  • 92. 
    If your trading a bond at a discount, the yield to maturity is 
    • A. 

      Lower

    • B. 

      Higher

  • 93. 
    If your trading a bond at a premium, the yield to maturity is
    • A. 

      Higher

    • B. 

      Lower

  • 94. 
    ___________allows bondholders to redeem the bond back to the issuer on a date prior to stated maturity. 
    • A. 

      Put Feature

    • B. 

      Call Feature

  • 95. 
    ________ allows the issuer to redeem the bonds prior to maturity.
    • A. 

      Call Feature

    • B. 

      Put Feature

  • 96. 
    An issuer is looking to raise $100mm, he issues bonds featuring coupons that all mature on one date. What kind of bond is this an example of?
    • A. 

      Serial Bond

    • B. 

      Term Maturity Bond

    • C. 

      Convertible Bond

    • D. 

      Sinking Fund

  • 97. 
    An issuer is looking to raise $100mm and issues 10 bonds with different coupons that mature at different times. This is an example of what type of bond?
    • A. 

      Serial bond

    • B. 

      Term Maturity Bond

    • C. 

      Convertible Bond

    • D. 

      Zero-Coupon bond

  • 98. 
    Typically, a higher yield bond costs
    • A. 

      More

    • B. 

      Less

  • 99. 
    True or False An issuer cannot redeem its bonds for a certain amount of time because bondholders are backed by "Call Protection".
    • A. 

      True

    • B. 

      False

  • 100. 
    The amount over par that an issuer must pay an investor for redeeming the security early is called,
    • A. 

      Call discount

    • B. 

      Call premium

    • C. 

      Premium over par

    • D. 

      Call feature

  • 101. 
    Assume an issuer calls in a bond, where does he get money to repay his investors?
    • A. 

      Sinking Fund

    • B. 

      Refunding issue

    • C. 

      Both a and b

    • D. 

      Neither a or b

  • 102. 
    According to positive convexity, as yields decline
    • A. 

      Prices decline as well

    • B. 

      Prices Increase

  • 103. 
    • A. 

      Rates rise

    • B. 

      Rates fall

  • 104. 
    Google has an indenture under the trust indenture act of 1939, what else is true?
    • A. 

      They are also subject to securities act of 1933

    • B. 

      They are exempt from securities act of 1933

  • 105. 
    If a bond was previously rated AA and dropped two notches, what is the bonds new rating?
    • A. 

      AA-

    • B. 

      AA+

    • C. 

      A+

    • D. 

      A

  • 106. 
    A contract that states "if the issuer defaults on one of their bonds, other than mine, they will automatically default on mine" is an example of:
    • A. 

      Bond default

    • B. 

      Cross Default

    • C. 

      Default Penalties

  • 107. 
    Xyz corp has a bond with a market price of $1,000 and is convertible at $20 per share. how many common shares can you convert to?
    • A. 

      20

    • B. 

      30

    • C. 

      40

    • D. 

      50

  • 108. 
    • A. 

      Price = 100 ratio 10:1

    • B. 

      Price = $50 Ratio 20:1

    • C. 

      Price = $25 Ratio 20:1

  • 109. 
    • A. 

      19.23

    • B. 

      20.83

    • C. 

      45.00

    • D. 

      45.45

  • 110. 
    Which bonds are issued outside the us, pay in US currency, exempt from SEC and may trade in secondary market after 40 days?
    • A. 

      Long term maturity bond

    • B. 

      Eurodollar bond

    • C. 

      Yankee Bond

  • 111. 
    Which bond is a foreign bond that is issued in the united states, pays interest & principle in us dollars, registered with the SEC and may trade immediately.
    • A. 

      Long term maturity bond

    • B. 

      Eurodollar bond

    • C. 

      Yankee Bond

  • 112. 
    US Treasuries are exempt from
    • A. 

      State Tax

    • B. 

      Local Tax

    • C. 

      Federal Tax

    • D. 

      All of the above

    • E. 

      Only A and B

  • 113. 
    T-bills have a duration of
    • A. 

      Up to one year

    • B. 

      2-10 years

    • C. 

      Over 10 years

  • 114. 
    T-notes have a duration of 
    • A. 

      Up to 1 year

    • B. 

      2-10 years

    • C. 

      More than 10 years

  • 115. 
    T-bonds have a duration of
    • A. 

      Up to 1 year

    • B. 

      2-10 years

    • C. 

      More then 10 years

  • 116. 
    Which US Treasury has the characteristics of 1)discount security2)trades w.o accrued interest
    • A. 

      T-notes

    • B. 

      T-Bills

    • C. 

      T-Bonds

    • D. 

      All of the above

    • E. 

      Only A and C

  • 117. 
    Which US Treasuries have the characteristics described below1)interest is stated annually, paid semi-annually2)Accrued interest 365 days
    • A. 

      T Bonds

    • B. 

      T Bills

    • C. 

      T Notes

    • D. 

      All of the above

    • E. 

      Only A and C

  • 118. 
    Which Security(s) are sold at a weekly auction
    • A. 

      T-notes

    • B. 

      T-Bills

    • C. 

      T-Bonds

    • D. 

      All of the above

    • E. 

      Only A and C

  • 119. 
    Which Security(s) are sold at a periodic auction
    • A. 

      T-bills

    • B. 

      T-notes

    • C. 

      T-bonds

    • D. 

      All of the Above

    • E. 

      Only B and C

  • 120. 
    How are T-bills quoted?
    • A. 

      Dollar amount basis

    • B. 

      Discount Yield Basis

  • 121. 
    Which US security(s) can be stripped? (coupon payments and principles sold separately as zero coupon securities, each discounted)
    • A. 

      T-bills

    • B. 

      T-notes

    • C. 

      T-bonds

    • D. 

      All of the above

    • E. 

      Only B and C

  • 122. 
    • A. 

      Principle $1,600 payment is $40.90

    • B. 

      Principle is $1,010 payment is $40.40

  • 123. 
    When referring to GNMA, FNMA, FHLMC, what is true about interest payments
    • A. 

      Interest portion only is fully taxed

    • B. 

      Interest and principle is fully taxed

    • C. 

      Principle only is fully taxed

  • 124. 
    A CMO (Collateralized Mortgage Obligations) is a mortgage backed bond created by dividing mortgage pools into various bond classes (tranches), they are rated AAA and issue $1,000 denominations, interest is paid monthly, principle paid sequentially, and helps to manage pre-payment risk. All of the following are divided into Tranches except:
    • A. 

      GNMA - government national mortgage association

    • B. 

      FNMA - Federal National Mortgage Association

    • C. 

      FHLMC- Federal Home Loan Mortgage Corporation

    • D. 

      SLMA - student loan marketing association

  • 125. 
    Which Mortgage is Fully Backed by the US Government
    • A. 

      GNMA

    • B. 

      FNMA

    • C. 

      FHLMC

    • D. 

      SLMA

    • E. 

      FFCB

  • 126. 
    Which CMO Tranche provides the most predictable cash flow and maturity?
    • A. 

      Planned amortization class or PAC Tranche

    • B. 

      Support or companion Tranche

    • C. 

      Z-Tranche

  • 127. 
    Which tranche is the last to receive payments?
    • A. 

      Planned Amortization Class Tranche (PAC)

    • B. 

      Support or Companion Tranche

    • C. 

      Z-Tranche

  • 128. 
    Which Tranche provides the least predictable cash flow and maturity?
    • A. 

      PAC - Planned Amortization Class Tranche

    • B. 

      Support or Companion Tranche

    • C. 

      Z-Tranche

  • 129. 
    The following are all derivatives except
    • A. 

      Options

    • B. 

      Forwards

    • C. 

      Futures

    • D. 

      Structured Products

    • E. 

      They are all derivatives

  • 130. 
    An options contract has intrinsic value if its
    • A. 

      In the money

    • B. 

      Out-of the money

    • C. 

      At the money

  • 131. 
    If GM on june is offering an option price of $35 to call at 3 and the market price is $36, it is
    • A. 

      In the money

    • B. 

      At the money

    • C. 

      Out of the money

  • 132. 
    If XYZ is offering an option to call at $110 and the market price is $109 it is
    • A. 

      In the money

    • B. 

      At the money

    • C. 

      Out of the money

  • 133. 
    If AMR is offering a put valued at $35 and the market price is $35 it is
    • A. 

      In the money

    • B. 

      At the money

    • C. 

      Out of the money

  • 134. 
    • A. 

      In the money

    • B. 

      At the money

    • C. 

      Out of the money

  • 135. 
    What is the close out of an opening purchase
    • A. 

      Closing purchase

    • B. 

      Closing sale

  • 136. 
    What is the close out of an opening sale
    • A. 

      Closing purchase

    • B. 

      Closing sale

  • 137. 
    Which contract is the most liquid?
    • A. 

      Forward contract

    • B. 

      Futures Contract

  • 138. 
    • A. 

      Bullish;option must be bearish

    • B. 

      Bearish;option must be bullish

  • 139. 
    If short the stock, 
    • A. 

      The investor is bullish; option must be bearish

    • B. 

      The investor is bearish; option must be bullish

  • 140. 
    Keynesian theory, has a fiscal policy that utilizes _________ to accomplish its goals?
    • A. 

      Money Supply

    • B. 

      Taxes and Expenditures

  • 141. 
    Monetary theory, which uses its monetary policy, utilizes ______ to accomplish its goals
    • A. 

      Taxes & Expenditures

    • B. 

      Money Supply

  • 142. 
    Who is responsible for the implementation of Keynesian Theory?
    • A. 

      Federal Reserve Board

    • B. 

      Congress

  • 143. 
    Who is responsible for the implementation of Monetary Theory?
    • A. 

      Federal Reserve Board

    • B. 

      Congress

  • 144. 
    What best Describes Regulation T
    • A. 

      The only rate directly controlled by Fed

    • B. 

      Extension of credit by Broker-dealers

    • C. 

      Amount of money a bank must maintain based on a percentage of deposits

  • 145. 
    Which best describes Discount Rate
    • A. 

      The only rate directly controlled by Fed

    • B. 

      Extension of credit by broker-dealer

    • C. 

      Amount of money a bank must maintain based on a percentage of deposits.

  • 146. 
    Which best describes Reserve Requirement?
    • A. 

      Extension of credit by broker-dealer

    • B. 

      The only rate directly controlled by Fed

    • C. 

      Amount of money a bank must maintain based on a percentage of deposits.

  • 147. 
    To increase money supply and ease credit, the Federal Open Market Committee (FOMC) must:
    • A. 

      Buy Securities from bankers or Repo causing deposits and reserves to increase

    • B. 

      Sell securities or reverse Repo causing deposits and reserves to decrease

  • 148. 
    To decrease money supply and tighten credit, the Federal Open Market Committee (FOMC) must:
    • A. 

      Buy Securities from bankers or Repo causing deposits and reserves to increase

    • B. 

      Sell securities or reverse Repo causing deposits and reserves to decrease

  • 149. 
    Average Workweek, Initial Claims for unemployment, New orders for consumer goods and materials, money supply (m2), index of consumer expectations and interest rate spread are all examples of
    • A. 

      Coincident Economic Indicators

    • B. 

      Leading Economic Indicators

    • C. 

      Lagging Economic Indicators

  • 150. 
    Industrial Production, Manufacturing and trade sales, personal income less transfer payments, employees on nonagricultural payrolls are all an example of
    • A. 

      Leading Economic Indicators

    • B. 

      Lagging Economic Indicators

    • C. 

      Coincident Economic Indicators

  • 151. 
    Average duration of employment, prime rate, CPI for services, labor cost per unit, commercial and industrial loans are all an example of
    • A. 

      Leading Economic Indicators

    • B. 

      Coincident Economic Indicators

    • C. 

      Lagging Economic Indicators

  • 152. 
    The calculation for market Capitalization (outstanding shares x market value per share) can be used to calculate Market Capitalization (Large Cap vs Nano cap) except when trying to calculate:
    • A. 

      Retail Investors

    • B. 

      Institutional Investors

    • C. 

      Restricted Stock

    • D. 

      Treasury Stock

  • 153. 
    True or False: A strong dollar will lower import prices and increase export prices.
    • A. 

      True

    • B. 

      False

  • 154. 
    • A. 

      True

    • B. 

      False

  • 155. 
    A Stronger Foreign Currency will have
    • A. 

      A positive effect on overseas investments

    • B. 

      A negative effect on overseas investments

  • 156. 
    A US company manufactures goods in Germany and sells them throughout Europe. A decline in the US dollar against the euro would have what effect on the company's Revenue and operating profit margin?
    • A. 

      There would be a decrease in revenue, but no effect on profit margin

    • B. 

      There would be an increase in revenue and profit margin

    • C. 

      There would be an increase in revenue and profit margin would remain the same

    • D. 

      There would be a decrease in revenue and profit margin

  • 157. 
    • A. 

      Operating profit margin will decline and revenue will increase

    • B. 

      Operating profit margin and revenue will both decline

    • C. 

      Operating profit margin will increase and revenue will decline

    • D. 

      Operating profit margin and revenue will both increase

  • 158. 
    On a balance Sheet, cash, Marketable securities, Accounts Receivable, and inventory are all an example of
    • A. 

      Current Assets

    • B. 

      Current Liabilities

    • C. 

      Fixed Assets

    • D. 

      Long-Term Liabilities

    • E. 

      Intangibles

  • 159. 
    On a balance sheet, Land, Buildings, and Equipment are all an example of 
    • A. 

      Current Assets

    • B. 

      Long-Term Liabilities

    • C. 

      Fixed Assets

    • D. 

      Intangibles

  • 160. 
    From the List, which is an example of Long Term Liabilities on a Balance Sheet?
    • A. 

      Land

    • B. 

      Inventory

    • C. 

      Accounts Payable

    • D. 

      Notes

    • E. 

      Retained Earnings

  • 161. 
    On a balance Sheet, which is an example of intangibles?
    • A. 

      Buildings

    • B. 

      Goodwill

    • C. 

      Paid-in-capital

    • D. 

      Bonds

  • 162. 
    Where would Retained Earnings and common/preferred stock go on a balance sheet?
    • A. 

      Fixed Assets

    • B. 

      Current Assets

    • C. 

      Intangibles

    • D. 

      Shareholder's Equity

  • 163. 
    True or false: the statement of Cash Flows (AKA statement of Sources AKA uses of Funds) reconciles changes in a company's cash position from one year to the next and is required in annual reports
    • A. 

      False

    • B. 

      True

  • 164. 
    In November 2009, RST Corp. paid the principal on a maturing debenture from its retained earnings. how will this action be recorded on the 2009 cash flow. 
    • A. 

      Financing Activity; source of cash

    • B. 

      Financing Activity;use of cash

    • C. 

      Investing Activity; Use of cash

    • D. 

      Operating Activity; use of cash

  • 165. 
    • A. 

      True

    • B. 

      False

  • 166. 
    True or false, Aggressive accounting use discount rates in calculating pension fund liabilities.
    • A. 

      True

    • B. 

      False

  • 167. 
    If a firm uses accelerated depreciation for tax reporting and straight line for GAAP reporting to shareholders, what is the effect on earnings during the early years?1)Creates lower earnings reported for tax purposes2)creates high earnings reported for tax purposes3)Increases deferred tax liability 4)Decreases deferred tax liability
    • A. 

      1 and 3 only

    • B. 

      1 and 4 only

    • C. 

      2 and 3 only

    • D. 

      2 and 4 only

  • 168. 
    When investing in other companies, the cost method is used if ownership interest is less than
    • A. 

      10%

    • B. 

      20%

    • C. 

      30%

    • D. 

      40%

    • E. 

      50%

  • 169. 
    • A. 

      1-20%

    • B. 

      20%-50%

    • C. 

      50-100%

  • 170. 
    • A. 

      WS would absorb 25% of AR earnings on Income statements (WS would increase by 2.5 million) (10 million - 25%= 2.5mm)

    • B. 

      ^^ Study the answer above

  • 171. 
    When investing in other companies, Consolidation is used when ownership interest is more than
    • A. 

      1-20%

    • B. 

      20-50%

    • C. 

      Exceeding 50%

  • 172. 
    True or False: balance sheet and income statements are combined when using consolidation method
    • A. 

      True

    • B. 

      False

    • C. 

      I dont know

  • 173. 
    • A. 

      True

    • B. 

      False

  • 174. 
    RYX Waste Developement has increased its ownership of JV Recyclers from 49% to 51%. What changes would be expected on the RYX balance sheet?
    • A. 

      Assets would decline and shareholders equity would increase

    • B. 

      Assets, Liabilities, and equity would increase

    • C. 

      Liabilities would decline and equity would increase

    • D. 

      Equity would increase if JV Recyclers was profitable

  • 175. 
    Goodwill and other intangible assets are only compared when the fair value is under the book value. For instance the fair value is 120 and the book value is 145, what is the impairment charge?
    • A. 

      $10mm

    • B. 

      $20mm

    • C. 

      $25mm

    • D. 

      $50mm

  • 176. 
    When a dividend is ______, the following occurs:1)retained earnings are reduced2)current liabilities are increased3)working capital is decreased4)current ratio is decreased
    • A. 

      Dividend is paid

    • B. 

      Dividend is declared

  • 177. 
    • A. 

      Dividend is Paid

    • B. 

      Dividend is Declared

  • 178. 
    True or False:when referring to stock splits and dividends1) Retained earnings is debited for the market value of shares2)Common stock is credited for the par value of the shares3)Paid-in capital is credited for the differenceHint: Memorize this Crap!
    • A. 

      True

    • B. 

      False

  • 179. 
    • A. 

      1 and 2 only

    • B. 

      2,3 and 4 only

    • C. 

      3 and 4 only

    • D. 

      4 only

  • 180. 
    • A. 

      Income, taxes, and inventory rises

    • B. 

      Income, taxes, and inventory decreases

  • 181. 
    When using (LIFO) for inventory, the last costs are matched with first units sold. The inventories reflect the cost of prior period purchases. what is true about using LIFO
    • A. 

      Income, taxes, and inventory rises

    • B. 

      Income, taxes, and inventory decrease

  • 182. 
    Peter knows company A needs to buy 100 units of a product.petere tells the company to buy 200 units and bring back whatever is left over for a return after a certain date so that it makes his numbers look good. What is this an example of?P.S. this is faud
    • A. 

      Selling away

    • B. 

      Wash Sales

    • C. 

      Premium Sales

    • D. 

      Channel Stuffing

  • 183. 
    Operating LeverageCompany A has $300,000 fixed costs, $340,000 in variable costsCompany B has $340,000 fixed costs, $300,000 in variable costsCompany A has significantly higher capacity utilization than company B however both companies have excess capacity.if each of the companies increase unit sales by 10%, which company has faster margin growth? explanation is given here
    • A. 

      Company A because of its fixed cost ratio

    • B. 

      Company B because of its fixed cost Ratio

    • C. 

      Company A because of lower capacity Utilization

    • D. 

      Company B because of higher capacity utilization

  • 184. 
    A company may have a one-time or nonrecurring event in which earnings are affected: -sale of an asset or business-severance cost-change in the method of accounting used-litigationwhat is the effect of these events on the companies financials? (Balance Sheet)
    • A. 

      Liability goes up, retained earnings goes down

    • B. 

      Liability goes down, retained earnings goes up

    • C. 

      Remember retained earnings is under shareholder equity

  • 185. 
    • A. 

      $30mm

    • B. 

      $20mm

    • C. 

      $18mm

    • D. 

      $9mm

  • 186. 
    Company J had Sales (revenue) of 250, Gross Profit of 110, Operating Profit of 46, and net income of 26 (all in millions), what is the profit margins (percentage) of gross profit
    • A. 

      44%

    • B. 

      18.4%

    • C. 

      10.4%

  • 187. 
    Company J had Sales (revenue) of 250, Gross Profit of 110, Operating Profit of 46, and net income of 26 (all in millions), what is the profit margins (percentage) of Operating Profit
    • A. 

      44%

    • B. 

      18.4%

    • C. 

      10.4%

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