Economics & Analysis
This economic indicator reflects current business conditions.
What is a coincident indicator?
This bond yield is the same as the coupon rate.
What is nominal yield?
This requires recommendations to match customer objectives and risk tolerance.
What is suitability?
This exam allows individuals to solicit securities transactions.
What is the SIE?
This federal agency enforces securities laws.
What is the SEC?
Which is considered a leading economic indicator?
A. GDP
B. Corporate profits
C. Housing starts
D. Unemployment rate
What are housing starts?
Which yield considers interest plus gain or loss at maturity?
A. Nominal
B. Current
C. Yield to maturity
D. Tax-equivalent
What is yield to maturity (YTM)?
Which factor is MOST important when making a recommendation?
A. Commission
B. Client age
C. Client objectives
D. Market timing
What are client objectives?
Which exam is required after the SIE to become registered?
A. Series 6
B. Series 63
C. Top-off exam
D. CFA
What is a top-off exam?
Which organization regulates broker-dealers?
A. SEC
B. FINRA
C. SIPC
D. FDIC
What is FINRA?
This measures the total value of goods and services produced within a country.
What is Gross Domestic Product (GDP)?
This measures annual income divided by current market price.
What is current yield?
This refers to the customer’s ability to withstand losses.
What is risk tolerance?
This education is required periodically to maintain registration.
What is continuing education (CE)?
This organization protects customer assets if a firm fails.
What is SIPC?
Which phase of the business cycle is marked by rising GDP and employment?
A. Peak
B. Expansion
C. Contraction
D. Trough
What is expansion?
Which investment return accounts for inflation?
A. Nominal return
B. Total return
C. Real return
D. Taxable return
What is real return?
Which account allows an RR to trade without prior approval?
A. Margin
B. Cash
C. Discretionary
D. Custodial
What is a discretionary account?
How often is Regulatory Element CE required?
A. Annually
B. Every 2 years
C. Every 3 years
D. Every 4 years
What is every 3 years?
Who regulates municipal securities?
A. SEC
B. FINRA
C. MSRB
D. FDIC
What is the MSRB?
This occurs when prices rise and purchasing power falls.
What is inflation?
This is the total amount paid to purchase an investment.
What is cost basis?
This principle requires acting in the customer’s best interest.
What is Regulation Best Interest (Reg BI)?
This form is used to register representatives.
What is Form U4?
This regulation addresses customer privacy.
What is Regulation S-P?
Which policy tool is used by the Federal Reserve to influence interest rates?
A. Fiscal policy
B. Open market operations
C. Tax policy
D. Regulation D
What are open market operations?
Long-term capital gains apply when a security is held:
A. Less than 6 months
B. Less than 1 year
C. More than 1 year
D. More than 2 years
What is more than 1 year?
Which customer objective prioritizes income and safety?
A. Growth
B. Speculation
C. Income
D. Aggressive growth
What is income?
This form terminates registration.
A. U4
B. U5
C. ADV
D. BD
What is Form U5?
Which regulation governs credit extension in margin accounts?
A. Reg D
B. Reg T
C. Reg BI
D. Reg M
What is Regulation T?
This economic theory supports increased government spending during recessions.
What is Keynesian theory?
This type of income is taxed at ordinary income rates.
What is interest income?
This occurs when excessive trading is used to generate commissions.
What is churning?
This CE focuses on firm-specific training.
What is Firm Element?
This prohibits market manipulation and fraud.
What is the Securities Exchange Act of 1934?
A slowing economy with rising unemployment describes which phase?
A. Expansion
B. Peak
C. Contraction
D. Recovery
What is contraction?
Which investment is federally tax-free but taxable at the state level?
A. Corporate bonds
B. Treasury securities
C. Municipal bonds
D. CDs
What are Treasury securities?
Which recommendation would be unsuitable for a conservative investor?
A. Treasury bonds
B. Blue-chip stocks
C. Options
D. Money market funds
What are options?
Which activity requires registration?
A. Clerical work
B. Investment advice
C. Bookkeeping
D. IT support
What is investment advice?
Who writes rules for exchanges and FINRA?
A. Congress
B. SEC
C. SIPC
D. Treasury
What is the SEC?
This type of analysis focuses on financial statements and company health.
What is fundamental analysis?
This occurs when an investor sells at a loss and repurchases within 30 days.
What is a wash sale?
This diversification strategy reduces unsystematic risk.
What is asset allocation?
This applies to individuals, not firms.
What is associated person registration?
This SRO oversees options trading.
What is the OCC?
This analysis relies on price trends and trading volume.
What is technical analysis?
This return includes income plus appreciation or depreciation.
What is total return?
This disclosure explains risks before a transaction occurs.
What is full and fair disclosure?
This occurs if CE requirements are not met.
What is inactive registration?
This occurs when firms fail to oversee RR activity properly.
What is failure to supervise?