FINRA Security Industry Essentials Practice Test 33

1. An investor has a conservative attitude towards investing and is seeking to invest $50,000 into an interest-bearing instrument that will provide current income and safety. You would most likely recommend which of the following?

2. You are the owner of a restaurant and you would like to have a guitarist play in the lounge on Saturday evenings. You have known your representative for 15 years and know her to be a great jazz guitarist. You think she would like to play and ask her if she is available to do so. She would have to notify which of the following before accepting your offer?

3. An individual applying for registration with a FINRA member firm would be required to include which of the following on Form U4?

4. A firm has been taken to arbitration by a customer. The disputed amount is $47,400. Which of the following is true?

5. A testimonial by a compensated expert, citing the results she realized following a member's recommendations, must include which of the following?

I. The name of the principal who approved the ad.

II. A statement detailing the expert's credentials.

III. A statement that the individual is a compensated spokesperson.

IV. A statement that past performance is not a guarantee of future performance.

6. You are the owner of a restaurant and you would like to have a guitarist play in the lounge on Saturday evenings. You have known your representative for 15 years and know her to be a great jazz guitarist. You think she would like to play and ask her if she is available to do so. She would have to notify which of the following before accepting your offer?

7. Which act gave the NASD (now part of FINRA) the authority to regulate the OTC market?

8. An investor is looking for a risk-free investment. An agent should recommend which of the following to this investor?

9. An investor has a conservative attitude toward investing and is seeking to invest $100,000 into an instrument that will provide current income and the most protection from interest rate risk. You would most likely recommend which of the following?

10. A customer has a large position in GJH, a thinly traded stock whose share price has remained flat for some time. The customer contacts the agent and wants to sell his entire position. The customer is most subject to which of the following?

11. Which of the following is true?

12. Which of the following accounts would not subject the account owner to required minimum distributions?

I. A traditional IRA.

II. A Roth IRA.

III. A joint account with survivorship rights.

IV. A variable annuity.

13. An investor who wishes to include a prior purchase of a mutual fund in a new letter of intent, wants to backdate the letter. Which of the following is correct?

14. An investor with $20,000 invested in the XYZ growth fund is:

15. You are long 10,000 shares of XYZ at 42 and are concerned about a market decline; you would like to take in some additional income. You should:

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