Series 7: Chapter 13 Practice Questions

Chapter 13 Practice Questions

1. 1. The following items are available for purchase with soft dollars except:
2. A. Cell phones
3. B. Employee salary
4. C. Copy machine
5. D. None of the choices listed can be purchased with soft dollars
6. 2. Which of the following outside activities does a broker not need to disclose to her employer prior to engaging in them?
7. A. Investing money in a real estate investment trust
8. B. Serving on a nonprofit board of directors
9. C. Teaching yoga at a local community center
10. D. Serving as a paid trustee on a family trust
11. 3. Which of the following activities can only occur in an Office of Supervisory Jurisdiction?
12. A. Creation of research reports
13. B. Solicitation of customer orders
14. C. Initial completion of customer paperwork
15. D. Order execution
16. 4. Ramsey Investments has just been informed that it has too many personnel (six) who have recently been associated with disciplined firms. An employer of 15 people in all, Ramsey wants to opt out. How many employees from disciplined firms must it fire and how quickly to fall below the threshold and avoid having to operate by the taping rule?
17. A. Two; 30 days
18. B. Three; 60 days
19. C. Three; 30 days
20. D. Six; 30 days
21. 5. FINRA requires each member firm to set up a system of written supervisory controls designed to perform all of the following activities except:
22. A. Monitor the transmittal of customers’ funds and securities
23. B. Conduct annual compliance meetings with the firm’s principals and reps
24. C. Validate changes to customers’ investment objectives
25. D. Review all customer account activities
26. 6. For representatives whose telemarketing activities are subject to the taping rule, when must the reports reviewing those taped conversations be submitted to FINRA?
27. A. Twice a year
28. B. Within 30 days of the end of