HESI A2: Basic Math Skills (Quiz 3)

A customer of a broker-dealer viewing a trade confirmation notices that there was a markup added to the price of 100 shares of stock recently purchased. This tells the customer that the broker-dealer

A prospective customer enters a branch office of Extraordinary Profits, Inc. (EPI), a broker-dealer registered with the Administrator. If the prospect wants to know the cost of obtaining certificates for securities she plans to purchase, the firm would most likely hand her a copy of

NASAA has created a Model Rule dealing with the creation of and delivery requirements for an investment adviser brochure. Under that rule, existing customers of the adviser, unless exempt, should expect to receive a copy of the adviser's brochure

NASAA has created a template for registered broker-dealers to disclose their fee schedules to existing and prospective customers. Which of the following charges would be disclosed?

For larger accounts, a broker-dealer is least likely to waive its normal fee for

NASAA has created a template for registered broker-dealers to disclose their fee schedules to existing and prospective customers. For those broker-dealers that are also registered as investment advisers, which of the following charges would not be disclosed?

Which of the following statements may be made by an agent of a broker-dealer? I. "I am a registered agent for XYZ broker-dealer." II. "I am a registered agent for XYZ broker-dealer, meaning my qualifications have been approved by the appropriate regulatory agencies." III. "This security I am recommending to you is registered on both the state and federal levels." IV. "This security I am recommending to you is registered on both the state and federal levels, meaning that both the SEC and the appropriate states have given their approval of this issue."

Under the Uniform Securities Act, when one is referring to a security that is guaranteed, the guarantee applies to I. capital gains to be expected by holding the specified security. II. dividends to be paid on the specified stock. III. interest and principal payments on the specified bond. IV. reimbursement by the firm for any losses suffered while holding that security.

A person registered in State C as an agent with Approved Retirement Investments (ARI), a registered broker-dealer, would be violating ethical standards

Under the Uniform Securities Act, the investment adviser brochure rule requires

While making a sales presentation of a mutual fund, the registered agent states to a customer that reinvesting the dividends will ensure selling shares at a profit. Making such a statement is

Securities regulators know that one of the most important ways to protect investors is requiring securities professionals to disclose information pertinent to the relationship with customers. When opening a new account, it is expected that a broker-dealer will disclose

When an agent has a personal relationship with the issuer of a security and has a bias toward recommending that issuer's stock, it would be considered

Under the Uniform Securities Act, the Administrator has the authority to I. issue stop orders. II. approve new issues. III. review standard registration forms.

Acme Manufacturing Company's latest stock offering is registered with both the SEC and the states. This would permit a registered agent to make the comment that

Securities regulators have taken a strong position on the need for registered broker-dealers to disclose the fees they charge. Among the most common ways for making this disclosure are I. presenting a chart with all of the fees. II. preparing a list of all of the fees. III. displaying the fees in tabular form.

When recommending a corporate security, an IAR indicates that the top officers of the company were responsible for the rapid growth of LJB Corporation, a well-known, successful firm in the same industry. Under the Uniform Securities Act, all of the following statements by the agent are permitted except

Promising Future Retirement Success (PFRS) is a state-registered investment adviser whose only activity is sponsoring wrap fee accounts. In line with the NASAA Model Rule on investment adviser brochures, PFRS shall deliver a copy of its

Which of the following statements may be made by an agent of a broker-dealer? I. "I am a registered agent for XYZ Securities, Inc., a registered broker-dealer." II. "I am a registered agent for XYZ Securities, Inc., a registered broker-dealer, meaning my qualifications have been approved by the appropriate regulatory agencies." III. "This security I am recommending to you is registered on both the state and federal levels." IV. "This security I am recommending to you is registered on both the state and federal levels, meaning that both the SEC and the appropriate states have given their approval of this issue."

Which of the following prospective clients of a registered investment adviser is exempt from the requirement to receive delivery of the adviser's brochure?

What does the term guaranteed mean when used to describe a security?

Gray is registered as an agent with Execrable Investment Returns (EIR), a broker-dealer registered with the SEC and the Administrator. Gray has a 55-year-old customer who has just inherited $100,000 and plans to retire once attaining age 70. Gray has recommended investing the money into several mutual funds offered by the KAPCO Fund Group, pointing out that over a 15-year period, mutual funds will outperform the market. Gray has

Disclosure to customers of a control relationship between a broker-dealer and the issuer of the security recommended is required in I. agency transactions. II. principal transactions. III. exempt transactions.

You receive a note from your firm congratulating you on passing the exam as an agent. Furthermore, your broker-dealer indicates that it has received notice from the Administrator that your registration as an agent is effective. At this point, you could not

Under securities industry regulations, all of the following are prohibited when attempting to make a sale except