TEAS Reading: Key Ideas and Details (Quiz 2) Welcome to your SIE Practice Quizzes. Note: We designed four (4) sets of practice quizzes for each Domain. each quiz set has 25 questions. Domain 2 (Set 4): Knowledge of Capital Markets. (25 questions) Please click NEXTÂ to start your Free SIE Practice Quizzes right away. Best of Luck! 1. SIE, Knowledge of Capital Markets,SIE Underwriters acting as principals and committing to purchase any unsold shares for the syndicate account would best be described as being engaged in A) an initial public offering (IPO). B) a primary. C) a best efforts. D) a firm commitment. None 2. SIE, Knowledge of Capital Markets,SIE A select pair or group of companies organized to underwrite corporate or municipal securities is best known as A) a syndicate. B) an investment club. C) a market maker. D) an introducing broker-dealer. None 3. SIE, Knowledge of Capital Markets,SIE Tombstone ads A) must be placed in all new offerings. B) are offers to sell securities to the public. C) are permitted before the effective date. D) are disclosures detailing all the information shown in a prospectus. None 4. SIE, Knowledge of Capital Markets,SIE In a combination (or split) offering, A) new shares are issued from the corporation and existing shares are sold by shareholders. B) shares are issued from existing shareholders only. C) all shares are issued from existing shareholders to the public. D) shares are issued to existing shareholders only. None 5. SIE, Knowledge of Capital Markets,SIE Which type of underwriting is characterized by the broker-dealer buying the entire issue from the issuer and then reoffering it to the public? A) Best efforts B) Mini max C) Firm commitment D) All-or-none None 6. SIE, Knowledge of Capital Markets,SIE A member firm receives an order to purchase shares in a common stock initial public offering (IPO) from another broker-dealer for a customer. Regarding restricted persons, the member must A) refuse to accept the order. B) obtain a statement witnessed by a notary representing that the buyer is not restricted. C) obtain a list of all of the broker-dealer clients to determine eligibility. D) obtain a written representation that the buyer is not a restricted person. None 7. SIE, Knowledge of Capital Markets,SIE In an underwriting where fixing a minimum dollar amount to be sold in order to move forward with the entire offering is most commonly referred to as A) all or none (AON). B) de minimis. C) firm commitment. D) mini-max. None 8. SIE, Knowledge of Capital Markets,SIE A person who looks to provide advice to a city government concerning the issuance of municipal debt securities would best be described as A) a market maker. B) an investment adviser. C) a municipal securities representative. D) a municipal advisor. None 9. SIE, Knowledge of Capital Markets,SIE Certain investors are deemed accredited when they have a net worth of A) $1 million, not including net equity in the primary residence. B) $200,000. C) $1 million. D) $500,000, not including net equity in the primary residence. None 10. SIE, Knowledge of Capital Markets,SIE A corporate issuer of common stock has decided that it wants an agreement that its underwriter must either raise all of the capital needed or cancel the underwriting. To best accommodate this the underwriting should be A) a firm commitment. B) a mini-max. C) an immediate of cancel. D) an all or none (AON). None 11. SIE, Knowledge of Capital Markets,SIE A company that offers sales of another company's securities would best be described as A) a transfer agent. B) an underwriter. C) a market maker. D) an issuer. None 12. SIE, Knowledge of Capital Markets,SIE Which of the following would take place in the primary market? A) Securities bought and sold on the NYSE B) Securities sold on both the OTC and NYSE C) Securities sold to the public by the issuer D) Securities bought and sold on the OTC None 13. SIE, Knowledge of Capital Markets,SIE A municipal advisor does which of the following activities? A) Advises municipalities on selling securities B) Advises institutions on selling municipal bonds C) Advises municipalities on buying securities D) Advises institutions on buying municipal bonds None 14. SIE, Knowledge of Capital Markets,SIE Primary market transactions would include which of the following? A) Sale of $10 million of corporate stock by a broker-dealer acting as a market maker B) Sale of $10 million of corporate bond by a broker-dealer acting as an underwriter C) Sale of $10 million of U.S. Treasury bonds by a broker-dealer acting as a market maker D) Sale of $10 million of municipal bonds by a broker-dealer acting as a market maker None 15. SIE, Knowledge of Capital Markets,SIE The access equals delivery rule applies to A) the final prospectus and aftermarket delivery obligations. B) the final prospectus delivery requirements during the cooling-off period. C) all prospectuses delivered before the registration date. D) the preliminary prospectus delivery requirements during the cooling-off period. None 16. SIE, Knowledge of Capital Markets,SIE Which of the following calls for the underwriters to buy securities from the issuer acting as an agent, not as principal? A) Initial public offering B) Firm commitment underwriting C) Follow-on offering D) Best efforts underwriting None 17. SIE, Knowledge of Capital Markets,SIE Sales for new issues of securities may be solicited A) after the cooling-off period. B) before, during, or after the cooling-off period, if done with a final prospectus. C) before the cooling-off period. D) during the cooling-off period. None 18. SIE, Knowledge of Capital Markets,SIE When the Securities and Exchange Commission (SEC) clears securities for sale to the investing public, this is A) the time upon which the SEC approves the securities. B) the due date. C) the effective date. D) the exudate. None 19. SIE, Knowledge of Capital Markets,SIE The federal law requiring companies offering public equity or debt securities to provide a prospectus to investors is known as A) the Securities Exchange Act of 1934. B) the Securities Investors Protection Act of 1970. C) the Securities Act of 1933. D) the Trust Indenture Act of 1939. None 20. SIE, Knowledge of Capital Markets,SIE Capital markets can be characterized by all of the following except A) they would include stock and bond markets. B) securities traded in them can be bought and sold by both individuals and institutions. C) entities can utilize them to finance both long- and short-term capital needs. D) they are utilized by the public sector only. None 21. SIE, Knowledge of Capital Markets,SIE Which of the following best describes a final prospectus? A) Meets the full and fair disclosure requirements of the Securities Act of 1933 B) Filed with the Securities and Exchange Commission (SEC) but is never made available to the general public C) Must be refiled with the SEC on an annual basis D) Used to solicit indications of interest in a new issue during the cooling-off period None 22. SIE, Knowledge of Capital Markets,SIE A preliminary prospectus (red herring) A) will show the final offering price. B) may be used to gather indications of interest. C) may not be distributed during the cooling-off period. D) if requested by an investor serves as a binding order to purchase shares. None 23. SIE, Knowledge of Capital Markets,SIE Securities regulations that are called blue-sky laws refer to those at A) both the state and the federal level. B) the state level. C) neither the state nor the federal level. D) the federal level. None 24. SIE, Knowledge of Capital Markets,SIE A tombstone advertisement placed before the effective date can A) only be placed by those assisting the issuing company in the underwriting. B) be placed by the issuer directly or by the underwriters. C) always be deemed to be an offer to sell the securities. D) only be placed by the issuing company. None 25. SIE, Knowledge of Capital Markets,SIE Underwriters who are assisting an issuer in bringing securities to the investing public can do which of the following between the time the registration was filed with the Securities and Exchange Commission (SEC) and the effective date? A) Mail sales literature to those who have expressed an interest in purchasing the securities. B) Distribute a preliminary prospectus to the investing public. C) Solicit orders from investors to purchase the securities. D) Make a binding offer to sell the securities. None 1 out of 25 Time is Up! Time's up
