FINRA-Investment Company and Variable Contracts Products Representative Qualification Examination Set 1

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FINRA-Investment Company and Variable Contracts Products Representative Qualification Examination Set 1

The Uniform Securities Act (USA) is

a body of laws governing the purchase and sale of securities within a single state. ✘ a set of guidelines for individual states to follow when formulating their own securities' laws. ✘ a group of laws requiring state-issued securities, such as municipal bonds, to be registered with. ✘ federal legislation that requires all states to adopt the same registration requirements for all. ✔

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Answer: Option B

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Once you have passed the Series 63 examination, which entity must then approve your application to sell securities?

FINRA ✘ NASAA ✘ SEC ✘ the state administrator ✔

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Answer: Option B

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Which of the following securities would not necessarily be exempt from state registration?

a stock listed on the Tokyo Stock Exchange ✘ a bond guaranteed by the Canadian government ✘ a bond issued by another state's employees' credit union ✘ a stock listed as a NASDAQ National Market Issue. ✔

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Answer: Option B

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Moe is a registered investment adviser doing business under the name of MoeMoney Investment Advisers, LLC. Larry, Curly, and Mary all hold positions with the
firm. Larry is on the board of directors; Mary is a sales representative for the firm; and Curly is an administrative assistant, who performs clerical duties.
Given that Moe is already a registered investment adviser, which of the other three are automatically registered as investment adviser representatives?

Larry only ✘ Larry and Mary only ✘ Larry, Mary and Curly ✘ Mary and Curly only ✔

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Answer: Option B

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Jack is employed by NewCorp, which is engaging in an initial public offering (IPO). Jack will need to register as a sales representative if he:

engages in transactions with the underwriters of the IPO for the purpose of taking the firm public. ✘ represents NewCorp in any transactions with financial institutions. ✘ participates in the selling of the new stock to individual investors. ✘ Jack will need to register as a sales representative if he performs any one of the above activities. ✔

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Answer: Option B

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Blue Sky Laws are designed to:

protect investors from fraud in their securities market transactions. ✘ protect agents, broker-dealers, and investment advisers and their representatives from spurious allegations of fraudulent activity. ✘ enhance the tourism industry within a state. ✘ favor investment in companies that engage in environmentally friendly practices. ✔

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Answer: Option B

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An individual who represents a broker-dealer in the buying and selling of securities is called a(n):

underwriter ✘ issuer ✘ agent ✘ administrator ✔

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Answer: Option B

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Which of the following statements best explains the difference between an agent and a broker-dealer?

An agent is an individual who represents a broker-dealer or an issuer and buys and sells securities he does not own in return for a commission on the transactions he executes. A broker-dealer may also buy and sell securities for his own portfolio, in which case the broker dealer enjoys any price appreciation on those securities. ✘ A broker-dealer must be licensed in the state in which he conducts business, but there are no separate licensing requirements for agents. ✘ Agents are engaged exclusively in the purchase and sale of stocks whereas broker-dealers also buy and sell bonds and option contracts. ✘ Agents conduct their business exclusively in the secondary market, while broker-dealers also operate in the primary market. ✔

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Answer: Option B

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Rich Writewell wants to begin publishing an independent weekly financial newsletter that will provide investment recommendations as well as other financial news
items to the general public. Rich hopes that his newsletter will achieve nationwide circulation within a few months.
Which of the following statements is true?

Rich will have to register as an investment adviser since his publication will include investment recommendations. ✘ Rich will have to register as an investment adviser only if he sells this newsletter to the public. If the publication is to be distributed free of charge, he will nothave to register. ✘ Rich may be exempt from registering as an investment adviser if he is a lawyer, accountant, engineer, or teacher. Otherwise, he will have to register. ✘ Rich will not have to register as an investment adviser since he is publishing a legitimate financial newsletter for distribution to the general public. ✔

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Answer: Option B

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10.

Erin is a registered agent who works for SecureMoney Brokers-dealers. One of her clients, Mrs. McTurk, is a recently-widowed woman who relies on Erin for advice
about her investment portfolio. Mrs. McTurk reminds Erin of her own grandmother, and she is happy to provide guidance within the sphere of her own knowledge.
Based on these facts, which of the following statements is true?

SecureMoney Broker-dealers must register as an investment adviser since one of its employees is providing investment advice. ✘ Erin must register as an investment adviser since she is providing investment advice. ✘ SecureMoney Broker-dealers must register as an investment adviser since one of its employees is providing investment advice, and Erin must register as aninvestment adviser representative as the firm's employee. ✘ Neither SecureMoney Broker-dealers nor Erin must register as an investment adviser based on the facts provided. ✔

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Answer: Option B

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FINRA-Investment Company and Variable Contracts Products Representative Qualification Examination Set 1

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