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FINRA SIE Exam Reviewed Questions And Answers, Exams of Andragogy

Phoenix CollegeAndragogy

A collection of reviewed questions and answers related to the finra sie exam. It covers various topics in finance, including bonds, stocks, dividends, and investment companies. Useful for individuals preparing for the sie exam, offering insights into common exam questions and concepts.

Typology: Exams

2024/2025

Available from 01/16/2025

Nursebrahim01
Nursebrahim01 šŸ‡ŗšŸ‡ø

485 documents

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W/W15
FINRA SIE Exam Reviewed Questions And Answers
GRADED A+
1. IfWinterestWRatesWfallWtheWissuerWwillWmostWlikelyWcallWwhichWbondsWfirst?:WHigh
DividendWRateWpreferredWissuesWtradingWatWaWpremium
2. WhatWareWsomeWactionsWbyWaWcorporationWwillWaffectWanWindividualsWcommo
nWshareholder'sWequity:WConversionWofWconvertibleWpreferredWstocksWorWbondWRep
urchaseWofWcommonWshares
IssuanceWofWadditionalWcommonWshares
(StockWsplitsWdoWnotWeffectWshareholdersWequityWbutWitWmustWbeWvotedWonWbecauseWitWef
fectsWParWValue)
3. BenefitsWtoWaWConvertibleWstockWcomparedWtoWaWregularWdebenture:WConvertibl
eWstockWwillWhaveWaWslightlyWlowerWyieldWthanWnon-
convertibleWhoweverWitWwillWraiseWinWvalueWasWtheWmarketWpriceWofWcommonWstockWrises
4. WhatWtraitsWdoWpreferredWstockWandWbondsWhaveWinWcommon?WHowWareWtheyW
different?:WCanWbeWcallableWbyWissuer,WbothWhaveWperiodicWpayments.WBothWareWsenio
rWsecuritiesWtoWcommonWstock.
NeitherWhaveWvotingWrights
PreferredWisWpaidWdividendsWonWaWpercentageWofWfaceWvalueWmuchWlikeWtheWyieldWofWaWb
ond.
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Download FINRA SIE Exam Reviewed Questions And Answers and more Exams Andragogy in PDF only on Docsity!

1

FINRA SIE Exam Reviewed Questions And Answers

GRADED A+

  1. IfWinterestWRatesWfallWtheWissuerWwillWmostWlikelyWcallWwhichWbondsWfirst?:WHigh DividendWRateWpreferredWissuesWtradingWatWaWpremium
  2. WhatWareWsomeWactionsWbyWaWcorporationWwillWaffectWanWindividualsWcommo nW shareholder'sWequity:WConversionWofWconvertibleWpreferredWstocksWorWbondW Rep urchaseWofWcommonWshares IssuanceWofWadditionalWcommonWshares (StockWsplitsWdoWnotWeffectWshareholdersWequityWbutWitWmustWbeWvotedWonWbecauseWitW ef fectsWParWValue)
  3. BenefitsWtoWaWConvertibleWstockWcomparedWtoWaWregularWdebenture:WConvertibl eW stockWwillWhaveWaWslightlyWlowerWyieldWthanWnon- convertibleWhoweverWitWwillWraiseWinWvalueW asWtheWmarketWpriceWofWcommonWstockWrises
  4. WhatWtraitsWdoWpreferredWstockWandWbondsWhaveWinWcommon?WHowWareWtheyW different?:WCanWbeWcallableWbyWissuer,WbothWhaveWperiodicWpayments.WBothWareWsenio rW securitiesWtoWcommonWstock. NeitherWhaveWvotingWrights PreferredWisWpaidWdividendsWonWaWpercentageWofWfaceWvalueWmuchWlikeWtheWyieldWofWaW b ond.

2 PreferredWstockWhasWnoWmaturityWdateWandWcanWbeWheldWperpetuallyWwhileWbondsWhav eW aWsetWmaturityWdate. PaymentsWtoWpreferredWstockWareWnotWmandatoryWunlessWaWdeclaredWdividendWhasWbeen W issuedWtoWcommonWstock PaymentsWtoWbondWholdersWareWmandatory

  1. WhenWareWcommonWdividendsWdeclaredWandWpaid?:WQuarterlyWforWboth
  2. AWcustomerWownsW 256 WsharesWofWABCWcommonWstock.WABCWdeclaresWaWright sW offering,WwithWtheWtermsWbeingWthatWforWeveryW 15 WrightsWaWshareholderWmayW p urchaseWoneWadditionalWshare.atW$24WaWshare.WAnyWfractionalWrightsWmayWbeW ro undedWupWtoWbuyWanWadditionalWshare. HowWmanyWsharesWmayWtheWcustomerWbuyWwithWtheseWright?:WAWshareWholderWcan W buyWaWmaximumWofW 18 WsharesWwithWtheseWrightsWpayingW$432WforWthem. TheW17.06WsharesWmayWbeWroundedWupWtoW18.
  3. XXYZWADRW(AmericanWDepositoryWReceipt)WrepresentsW10%WofWtheWvalueWofW anWXXYZWordinaryWshare.WTheWordinaryWsharesWtradeWonWtheWLondonWStockW Ex change,WwhereWtheWcurrentWpriceWisW 400 WBritishWPoundsW(BP).WTheWcurrentW exc hangeWrateWforWtheWBritishWPoundWagainstWtheWUSWDollarWisW$1.40.TheWordinaryW s hareWpaysWanWannualizedWdividendWofW 12 WBP.WTheWXXYZWADRWisWlistedWonWtheWN YSE.WIfWaWcustomerWplacesWanWorderWtoWbuyW$560,000WofWtheWADRWonWtheW custo merWwillWbuyWhowWmanyWsharesWofWtheWADR?:W10,000WSharesWwithW$560.,

4

  1. USWTreasuryWBonds
  2. TreasuryWBills
  3. PrimeWCommercialWPaper
  4. PrimeWBanker'sWAcceptances:W3)WPrimeWcommercialWpaperWisWnotWtradedWbyWth eW FederalWReserveWthereforeWdoesWnotWsettleWinWFedWFunds PrimeWBanker'sWAcceptances,WTWBills,WTWBonds,WareWallWsettledWinWFedWFunds
  1. AllWofWtheWfollowingWareWsourcesWofWincomeWthatWcanWbeWusedWtoWserviceWdeb tW onWmunicipalWrevenueWbondsWExcept?
  1. TollWFees
  2. ParkWFees
  3. CapitalizedWinterest

5

  1. SalesWTax:WCapitalizedWinterestW(propertyWtax)WisWnotWusedWinWrevenueWbonds,WitWis onlyWusedWinWGeneralWObligationWBonds
  1. AWcorporationWissuedWaW7%WAAWsinkingWfundWdebentureWatWpar.WThreeWyears W later,WsimilarWissuesWareWbeingWissuesWatW8%.WWhichWofWtheWfollowingWisWtrueWabo utW theWoutstandingW7%Wissue?WHowWdoesWtheWcurrentWyieldWrelateWtoWtheWnomi nalW yield:WTheWcurrentWyieldWwillWbeWhigherWthanWtheWnominalWyield. TheWnominalWyieldW(statedWyield)WwillWbeW7% TheWmarketWpriceWofWtheWyieldWwillWdropWwhenWtheWnewWissuesWareWatWaWhigherWyield. CurrentWyieldW=WannualWinterestW$/WcurrentWmarketWprice W marketWpriceW=W.07W/W.08W=W 875 CurrentWyieldW=W 70 W/W 875 WCurre ntWyieldW=W. CurrentWyieldW>WNominal
  2. HowWwouldWyouWquoteWaWUSWGovernmentWbondWwithWaWdollarWpriceWof $1012.50?:W 101 - 8 USWGOVTWbondsWareWquotedWonWaWpercentageWofWparWatW1/32ndsW 1 01 W+W8/32W=W101.25WthenWmultiplyWbyW10xWtoWgetWtoWpar $1012.
  3. AWcorporationWhasWissuedW9%,W$1,000WparWconvertibleWdebentureWwhichW co nvertWatW$50.WTheWcommonWstockWisWcurrentlyWtradingWatW$60.WIfWtheWbondWandW t heWcommonWstockWareWtradingWatWparityWaWcustomerWpurchasingW5MWofWtheWbonds

7

  1. IssuanceWofWwhichWofWtheWfollowingWmunicipalWissuesWareWNOTWsubjectWto statutoryWdebtWlimits:WSpecialWtaxWbondsW In dustrialWRevenueWBonds MoralWObligationWbondsW CO PS (GeneralWObligationWareWsubjectWtoWdebtWlimits)
  2. AWcorporationWhasWissuedWbondsWatW8%.WThreeWyearsWlaterWsimilarWissuesWar eW beingWofferedWinWtheWprimaryWmarketWatW7%WwhichWofWtheWfollowingWstatemen tsW willWbeWtrueWaboutWtheWcurrentWyieldWandWtheWnominalWyield?:WTheWcurrentWyield WwillW beWlowerWthanWtheWnominalWyield.WTheWdollarWpriceWofWtheWbondWwillWbeWatWaWpremi um. NominalW(stated)W=W. MarketWpriceWofWbondW=W.08/.07W=W1,143W Curr entWYieldW=W 80 W/W 1143 W=W.
  3. NewWissuesWofWGovernmentWdebtWareWissuedWinWwhatWform? FullyWregistered FullyWregisteredWtoWprincipalW BookWentry MegaWsuperWregisteredWtoWaWbro:WBookWentry
  4. AllWnewWcorporateWbondsWareWissuedWinWwhatWform? FullyWregistered WBookWentryW Me

8 gaWmanWentry RegisteredWtoWprincipal:WBookWentry

  1. zeroWcouponWbond:WaWbondWthatWmakesWnoWcouponWpaymentsWandWisWthusWinitiall yW pricedWatWaWdeepWdiscount
  2. callWpremium:WTheWcallWpremiumWisWanWamountWoverWtheWfaceWvalueWofWtheWsecurit yW andWisWpaidWinWtheWeventWthatWtheWsecurityWisWredeemedWbeforeWtheWscheduledWmatu rityW date.WPutWanotherWway,WtheWcallWpremiumWisWtheWdifferenceWbetweenWtheWcallWpric eWofW theWbondWandWitsWstatedWparWvalue.
  3. WhoWratesWcommercialWpaper?:WMoody's,WStandardWandWPoor's,WFitch NOTWBEST's

10

  1. UnitWInvestmentWTrust
  2. FaceWAmountWCertificateWCompany (WRealWEstateWInvestmentWTrustWareWnotWconsideredWunderWthisWact)

11

  1. ConstitutionalWDebtWLimitsWareWimposedWonWtheWissuanceWof?:WGeneralWOblig- ationWbonds (MoralWobligationWbondsWareWnotWsubjectWtoWdebtWlimitsWtheyWareWissuedWinWdesperation)
  2. WhichWofWtheWfollowingWpayWdividends ?W IWWarrants II ADR's III PreferredWStocks IV RealWEstateWInvestmentWTrustWShares:WIIW,WIIIW,WIV WarrantsWareWtheWonlyWonesWthatWdoWnotWpayWdividends
  3. WhichWrightsWdoWshareholdersWinWaWmanagementWcompanyWhave? I VoteWforWtheWBoardWofWDirectors II VoteWforWtheWinvestmentWadviserWofWtheWfun dWIIIWReceiveWsemi- annualWandWannualWreports IVWChooseWtheWbrokerWwhoWexecutesWtheWportfolioWtransactions:WTheyWhaveWthe W followingWrights (VotingWforWBOD,WVotingWforWtheWadviser,WReceiveWreports)
  4. TrustWindentureWofWaWBondWcontainsWtheWfollowingWinformation?:WInterestWRat eWMaturity

13 I UsedWtoWsellWatWpricesWthatWareWlowerWthanWcurrentWmarketWprices II UsedWtoWsellWatWpricesWthatWareWhigherWthanWtheWcurrentWmarketWpric eWIIIWGuaranteesWaWspecificWprice IVWDoesWnotWguaranteeWaWspecificWprice:WIIWandWIII SellWaboveWtheWcurrentWmarketWpriceWGuaranteesWaWspecificWprice (TheseWsecuritiesWcanWonlyWbeWfilledWatWtheWcurrentWmarketWpriceWorWhigherW- WsoWtheyW doWguaranteeWaWspecificWpriceWorWbetter)

  1. AWmunicipalityWwishesWtoWsellWaWbondWissueWthatWisWNOTWbackedWbyWtaxin gW power.WWhichWofWtheWfollowingWbondsWcanWbeWissued? I RevenueWBond II IndustrialWRevenueWBond W IIIWGeneralWobligationWBon d IVWLeaseWrentalWbond:WIW,WII,WandWIV OnlyWGeneralWobligationWbondsWareWrequiredWbyWtaxingWpower.WTheWrestWareWrevenue W backed
  2. StockholderWapprovalWisWneededWifWaWcorporationWwishesWtoWdoWwhichWofWth eW following?

14 IWSplitWit'sWstockW 1 WforW 2 W IIWSplitWitsWstockW 2 WforW 1 IIIWRepurchasesWsharesWforWit'sWTreasuryWI VWIssueWconvertibleWsecurities:WIWIIWandWIV StockWsplitsWrequireWaWvoteWbecauseWtheyWchangeWtheWparWvalueW Is sueWofWconvertibleWsecurities

  1. DividendsWcanWbeWpaidWoutWinWwhichWthreeWways:WMakingWcashWdistributionsWo nW stocksW(cash) ProductWdistribution

16 hW StockWsplitsWareWalsoWnotWtaxable

  1. WhatWareWthreeWrightsWofWaWshareholderWofWcommonWstock?:WRightWtoWvoteWo nW membersWofWtheWBOD RightWtoWdividends

17 RightWtoWtransferWshares

  1. WhichWofWtheWfollowingWactionsWbyWaWcorporationWwillWaffectWanWindividua lW commonWshareholder'sWequity? IWDeclarationWofWstockWdividendWorWStockWsplitW IIWConversionWofWconvertibleWpreferredWstock IIIWRepurchaseWofWcommonWsharesWoutstandingW(StockWbuyWbackW I VWIssuanceWofWadditionalWcommonWshares:WIIWIIIWandWIV WillWallWeffectWanWindividualWshareholdersWequityW StockWsplitsWandWStockWdividendsWwillWnot
  2. ABCWCorpWdeclaresWaW3:1WStockWsplitWtoWshareholdersWofWrecordWonWNovem

W berW10th.WTheWpriceWofWtheWstockWwillWbeWreducedWonWtheWexWdateWby::WTheWstoc kW willWbeWreducedWonWtheWexWdateWbyW67%

  1. WhichWofWtheWfollowingWsecuritiesWtradeWinWtheWsecondaryWmarket? I Preferred II AmericanWDepositoryWReceipt sW IIIWMutualWFinds IVWMunicipalWBonds:WIWIIWandWIV MutualWFundsWdoWNOTWtradeWinWtheWsecondaryWmarket
  2. AWmiddleWageWwomanWwidowedWcustomerWhasWanWinvestmentWobjectiveWo

10 W/W 1 5 IWTradeWatWaWPremiumWtoWparW IIWTradeWatWaWdiscountWtoWpar III HaveWaWthinlyWtradedWmarket IV HaveWanWactiveWmarket:WIIWandWIII TheyWtradeWatWaWslightWdiscountWandWareWnotWtradedWactively

  1. WhichWofWtheWfollowingWisWneededWtoWcomputeWtheWtotalWdollarWpriceWofW aW municipalWbondWtradedWonWaWyieldWbasesWinWtheWsecondaryWmarket? I DatedWDate II MaturityWDat eWIIIWCallWDate IVWPutWDate:WMaturityWandWCallWDateWareWtheWonlyWonesWneeded
  2. TheWmoneyWthatWbankWhasWinWexcessWofWreservesWisWcalledWthe ?W IWClearingWhouseWfunds II FederalWFunds III MoneyWMarketWFunds IV AvailableWFunds:WIIWFederalWFunds
  3. AnWOpenWendedWfundWhaveWaWNAVWofW$10/share.WTheWminimumWpurchas eW priceWis?

10 W/W 1 5

IW$

IIW$10WplusWcommissionWI IIWTheWmarketWprice