FINRA Practice Test 1 Review

true

T/F? Stability in the value of a debt portfolio is greatest when when maturities of the debt securities are short

false

T/F? Stability in the value of a debt portfolio is greatest when when maturities of the debt securities are long

a closing purchase

A transaction in which a writer covers a position by purchasing an option is called a _____________

true

T/F? Foreign and domestic debt instruments are subject to political risk

false

T/F? Foreign and domestic debt instruments are subject to exchange risk

true

T/F? Foreign and domestic debt instruments are subject to repayment risk

true

T/F? Foreign and domestic debt instruments are subject to interest rate risk

money market

_______________ assets mature in one year or less

rising

Call protection is most valuable to an investor when bond prices are ______________

falling

Call protection is most valuable to an investor when bond yields are ____________

false

T/F? A personal bankruptcy filing on the U4 would result in a statutory disqualification

false

T/F? A written customer complaint on the u4 would result in a statutory disqualification

false

T/F? A felony theft charge on the u4 would result in a statutory disqualification

true

T/F? A felony conviction for DUI on the U4 would result in a statutory disqualification

true

T/F? Upon expiration, all in the money SPX call options are settled by delivery of cash

false

T/F? Upon expiration, all in the money SPX call options are settled by delivery of SPX index stocks

false

T/F? Upon expiration, all in the money SPX call options are settled by delivery of SPX ETFs

false

T/F? Upon expiration, all in the money SPX call options are settled by delivery of the same number of SPX put options

true

T/F? It is considered prohibited and fraudulent for a firm to agree to repurchase shares at no less than the original sales price

false

T/F? It is not considered prohibited and fraudulent for a firm to agree to repurchase shares at no less than the original sales price

true

T/F? US Government agency issues are exempt from registration requirements under the securities act of 1933

false

T/F? US Government agency issues are not exempt from registration requirements under the securities act of 1933

market

_______________ risk is the greatest risk in a variable life insurance policy

Minor

UTMA accounts are opened under the tax id of the _____________

13 months

How long is a customer's letter of intent on a mutual fund purchase valid for?

true

T/F? The owner of Treasury bonds is most exposed to inflationary risk

false

T/F? The owner of utility stocks is most exposed to inflationary risk

false

T/F? The owner of treasury bills is most exposed to inflationary risk

false

T/F? The owner of blue chip industrials is most exposed to inflationary risk