Question 1

A broker-dealer (BD) creates a marketing postcard that includes a statement regarding FINRA's endorsement of the BD. Which of the following responses is true?

Options :

A : The statement regarding FINRA-s endorsement is not permissible.

B : The statement is permissible if a principal of the BD approves it in writing prior to use.

C : The statement is permissible if the statement is approved in writing by FINRA prior to use.

D : The statement is permissible if the postcard does not discuss specific investment opportunities.

Answer: A

Question 2

At a prospecting event, a registered representative (RR) provides cards for attendees to write down their contact information if they want to have a follow-up meeting with her. Which of the following actions should the RR take in this situation to comply with telemarketing rules?

Options :

A : Obtain the broker-dealer-s approval before making a call

B : Limit contact with prospects to between 9 a.m. and 9 p.m.

C : Contact the prospects at will since they provided express written consent

D :

Prior to contacting the prospects, check all of the names on the cards to make sure they are not on the National Do Not Call Registry

Answer: D

Question 3

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 4

The process in which the buying firm must pay for the securities and the selling firm must deliver the securities is known as:

Options :

A : A corporate action

B : Clearing the trade

C : The settlement of the transaction

D : A delivery versus payment (DVP) transaction

Answer: C

Question 5

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

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