Mr. Teche is an agent with broker-dealer CanDo, and his only compensation is the commissions he earns on trades he executes. He has applied for and been granted an adjunct teaching position with a local university that will allow him to earn money while he is establishing himself.

Which of the following statements are true?

A. As an agent with broker-dealer CanDo, Mr. Teche must notify CanDo in writing of this position prior to accepting it.

B. CanDo can deny Mr. Teche permission to accept the adjunct teaching position.

C. Mr. Teche is, in essence, an independent contractor with broker-dealer CanDo and can engage in any other business activity at will.

D. Both A and B are true.

Stable Corporation registered a bond issue that it plans to offer for sale in the state with the Administrator.

The bond has a par value of $1,000 and will pay interest of 7% a year, with the principal to be repaid in 5 years. The registration became effective on September 8th. The registration is effective

A. until the maturity date on the bond.

B. for one full year.

C. until December 31st of the same year

D. for two full years.

Stu Pede is an agent with broker-dealer Cavalier. A customer calls with a request to establish a classic IRA and asks for Stu's advice regarding where the money in the IRA should be invested. Stu suggests a municipal bond fund, explaining to his client that the interest income earned on it will be tax-free at the federal level, and some of it may even be tax-free at the state and local levels.

Has Stu engaged in any prohibited practices?

A. Yes. Stu is an agent with a broker-dealer. He is not an investment adviser representative and is not allowed to make recommendations regarding investments to the firm's clients.

B. No. Although Stu has given investment advice, it was solicited by the client, and Stu received no additional compensation for the advice.

C. Yes. Municipal bonds are not suitable investments for a classic IRA, and Stu can have his license revoked or suspended.

D. No. Although municipal bonds are not suitable investments for a classic IRA, Stu obviously didn't know this and is merely guilty of stupidity.

Which of the following entities is subject to be accused of churning?

I. investment advisers

II. investment adviser representatives

III. broker-dealers

IV.

agents

A.

II and IV only

B.

I and III only

C.

II, III, and IV only

D.

I, II, III, and IV

The Turnover Corporation, a firm with 25,000 employees, has recently hired 50 new employees, many of whom have been hired to replace middle-level managers who have retired. Turnover has omitted this fact from its prospectus. Turnover is guilty of

A. fraud.

B. misrepresentation.

C. misusing insider information.

D. nothing. The hiring of 50 new employees by a firm with 25,000 employees is not a material fact.

Skip is a registered agent with state. He recently quit his job with Venus Broker-Dealers to become affiliated with Mars Broker-Dealers.

Which of the three entities must report this change to the state Administrator?

A. Skip only

B. Skip and either Mars or Venus, but not both

C. Both Skip and Venus

D. Skip, Mars, and Venus

Broker-Dealer Wheeler has no offices in the state. Wheeler does, however, sell corporate bonds from his portfolio to banks and insurance companies located in the state that purchase the bonds for their investment portfolios. He executes about twelve of these transactions a year. Wheeler profits from the price appreciation of the bonds during the time he held them, but receives no other form of compensation. Based on these facts,

A. Wheeler must register as a broker-dealer in the state, but the securities do not need to be registered.

B. Wheeler need not register in the state, and the securities are also exempt from registration.

C. Wheeler must register as a broker-dealer in the state, and the securities must also be registered before they can be sold to in-state investors.

D. Wheeler need not register in the state, but the securities must be registered before they can be sold to in-state investors.

Finn Nance has recently passed his CFP exam and is now a certified financial planner. He has new business cards printed that have the words "Certified Financial Planner" printed under his picture. In doing so,

A. Finn has not violated any laws or engaged in any prohibited practices.

B. Finn has violated a securities law. The Uniform Securities Act prohibits anyone from using the word "certified" on any advertisement for services.

C. Finn has possibly violated a state securities regulation. The Administrator in many states prohibits the use of the word "certified" on any advertisement for services.

D. Finn is not in violation of any laws as long as he has notified the state Administrator of his new designation and his new logo.

Once you have passed the Series 63 examination, which entity must then approve your application to sell securities?

A. FINRA

B. NASAA

C. SEC

D. the state administrator

Which of the following would not appear on an order ticket?

A. the stock symbol

B. the account number of the client buying or selling the security

C. the settlement date

D. the agent's commission