SIE by FINRA Actual Free Exam Questions And Answers

Question 1

According to FINRA rules, under which of the following circumstances, if any, is a member firm permitted to send gifts to a registered representative of another member firm?

A. When the value of all gifts during a period of one year does not exceed $100

B. When no single gift exceeds $100 and there is no limit on the number of gifts

C. When no single gift exceeds $100 in value and the maximum value of all gifts per year equals $250

D. Under no circumstances

Discussion 0

Correct Answer: A Vote an answer

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Question 2

Under FINRA rules, which of the following activities is not considered an outside business activity (OBA)?

A. Selling real estate

B. Selling health insurance

C. Professionally refereeing athletic events

D. Passively investing in a multifamily house for rental purposes

Discussion 0

Correct Answer: D Vote an answer

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Question 3

Which of the following responses accurately describes a secondary market transaction?

A. Buying securities directly from the issuing company

B. Buying securities on a registered securities exchange

C. Buying securities in a private placement from a broker-dealer

D. Buying open-end mutual fund shares

Discussion 0

Correct Answer: B Vote an answer

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Question 4

A customer purchased 100 shares of Company XYZ common stock five years ago for $20.00 per share. Over the life of her investment, the customer received cash dividends of $2.00 per share, on which she paid total income taxes of $0.50 per share. She recently sold the stock for $30.00 per share. What is the customer's cost basis in each share of XYZ stock?

A. $20.00

B. $30.00

C. $22.00

D. $21.50

Discussion 0

Correct Answer: A Vote an answer

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Question 5

A customer receives a confirmation that discloses the firm has acted in a principal capacity. Which of the following statements is the best explanation for this disclosure?

A. The firm is selling to the customer from its inventory.

B. The firm is acting as an intermediary between the customer and another customer.

C. The firm matched the customer's purchase with a sell order listed on an electronic communication network (ECN).

D. The firm is acting as an intermediary between the customer and an unrelated firm.

Discussion 0

Correct Answer: A Vote an answer

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Question 6

Which of the following statements describes a characteristic of Treasury securities?

A. They are issued by the U.S. government with a high amount of default risk.

B. They are liquid.

C. They are FDIC-insured.

D. They are callable.

Discussion 0

Correct Answer: B Vote an answer

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Question 7

For up to how many business days is a firm initially permitted to place a temporary hold on disbursements for a specified adult account in which the firm reasonably believes financial exploitation has occurred?

A. 3 business days

B. 5 business days

C. 10 business days

D. 15 business days

Discussion 0

Correct Answer: C Vote an answer

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Question 8

A confirmation indicates a 100-share purchase of Company ABC at $11. According to SEC rules, which of the following information is required to be stated on the confirmation?

A. The firm's cost basis in the security

B. The firm's inventory level at the time of trade execution

C. That the firm did not act as a market maker in the security

D. The capacity in which the firm acted when executing the trade

Discussion 0

Correct Answer: D Vote an answer

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Question 9

A municipal securities dealer makes a political contribution of $990 to a local mayoral candidate. At the end of the quarter, to whom, if anyone, must the dealer report the contribution?

A. SEC

B. No disclosure required as the amount is below the reporting threshold

C. FINRA

D. MSRB

Discussion 0

Correct Answer: D Vote an answer

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Question 10

Which of the following entities issues certificates of deposit (CDs)?

A. Broker-dealers

B. Federal Reserve

C. FDIC

D. Banks

Discussion 0

Correct Answer: D Vote an answer

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FINRA Securities Industry Essentials Exam (SIE) - SIE Exam Practice Test

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