Question 1

A financial institution requesting a quote on a block of 100 bonds from a dealer ingovernment securities receives a quote of 98.02 bid, 98.06 asked.What is the dollar amount the institution will receive if the financial institution sells thesebonds to the dealer?’’

Options :

A : $98,062.50

B : $98,187.50

C : $98,250.00

D : $98,750.00

Answer: A

Question 2

Which are the primary considerations in evaluating the worth of a limited partnership?

Options :

A : the size of the tax deductions

B : the cost of assets

C : the adequacy of funding

D : both B and C

Answer: D

Question 3

Bubba plans to borrow some money and pledge securities as collateral. Which of the following can he not use as collateral?

Options :

A : Series EE bonds

B : US treasury bills

C : US treasury notes

D : US treasury bonds

Answer: A

Question 4

Under what circumstances may a municipal securities dealer guarantee a customer against loss in market value of bonds?

Options :

A : under no circumstances

B : only if the agreement is in writing

C : only if the bonds are rated AAA or Aaa

D : only if the bonds are insured

Answer: A

Question 5

Convertible preferred stock has all of the following characteristics except:

Options :

A : a lower dividend rate than non-convertible preferred

B : a dilution of earnings if converted into common stock

C : a requirement for shareholders to always accept the call price when called

D : required dividend payments to shareholders before any dividends are paid to holders of common stock

Answer: C

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