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Series 26 – Practice Test 1

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Question 1 of 10

1. Question

According to FINRA rules regarding associated persons, what would be the registration status of a registered representative who has been called up for active duty service in the US Military?

Special inactive status
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Designated military exclusion
Correct Incorrect Correct answer

Temporary Termination
Correct Incorrect Correct answer

U-5 Military Termination
Correct Incorrect Correct answer

Correct

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Question 2 of 10

2. Question

In instances in which a customer will be engaging in a viatical settlement of their insurance policy, with which policy will FINRA have a compliance concern?

Ordinary life policy
Correct Incorrect Correct answer

Variable annuity policy
Correct Incorrect Correct answer

Variable Life policy
Correct Incorrect Correct answer

Term insurance with the viatical ‘rider’
Correct Incorrect Correct answer

Correct

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Question 3 of 10

3. Question

Under updated FINRA rules pertaining to communications with the public, these communications fall into which of the following categories?

I. Retail communication

II. Institutional communication

III. 3rd party material supplied to the member firm

IV. Correspondence

All of these
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I and II only
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III and IV only
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I, II and IV only
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Question 4 of 10

4. Question

With regard to prospectuses to be furnished to public customers purchasing open-end investment companies, which of the following descriptions of the rules are most accurate?

Furnish a summary prospectus
Correct Incorrect Correct answer

Furnish a summary prospectus, and furnish the SAI if requested
Correct Incorrect Correct answer

Furnish the omitting prospectus
Correct Incorrect Correct answer

Furnish a prospectus upon the request of the customer
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Question 5 of 10

5. Question

Your member firm may become subject to FINRA’s Taping Rule under which of the following circumstances?

When your firm has filed a quarterly complaint report containing more than 3 allegations of unauthorized trading by registered representatives in your office.
Correct Incorrect Correct answer

When your firm has 20% of more of your sales agents having been hired from disciplined firms.
Correct Incorrect Correct answer

When your firm is in its first year of business
Correct Incorrect Correct answer

None of the above
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Correct

Incorrect
Question 6 of 10

6. Question

FINRA rules require that a member firm must, at a minimum, retain its complaint file for how long?

3 years
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6 years
Correct Incorrect Correct answer

4 years
Correct Incorrect Correct answer

Lifetime of the brokerage firm
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Correct

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Question 7 of 10

7. Question

Your firm is engaged in offering retirement plan services to the public. You often recommend open-end investment company shares to your clientele as the most suitable way to begin investing in securities. Which of the following plans are considered non-qualified plans?

Individual Retirement Arrangements
Correct Incorrect Correct answer

403b plans
Correct Incorrect Correct answer

401k plans
Correct Incorrect Correct answer

Deferred compensation plans
Correct Incorrect Correct answer

Correct

Incorrect
Question 8 of 10

8. Question

When more than one individual wishes to open an account at a B/D, and the owners of the account shall have their share of the account pass to their estate in the event of death, the proper account type they’ll be directed to open is the:

Joint Account with rights of survivorship
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Joint Account with Individual designation upon death
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Tenancy in Common
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Tenancy with rights of survivorship
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Question 9 of 10

9. Question

A registered rep is contacted by a client who instructs the RR to purchase $5,000 worth of the best performing growth fund which your firm makes available for sale. The rep can write up the order ticket for this client:

Only if the client puts the order in writing
Correct Incorrect Correct answer

Only if the order is approved by the Branch Manage
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Only if the client has a discretionary account
Correct Incorrect Correct answer

Only if the RR explains breakpoints to this client before placing the order
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Correct

Incorrect
Question 10 of 10

10. Question

None of the following qualify as securities as defined by the Securities & Exchange Commission with the exception of:

529 plan
Correct Incorrect Correct answer

501c3 plan
Correct Incorrect Correct answer

457 plan
Correct Incorrect Correct answer

All of the above plans are qualified
Correct Incorrect Correct answer

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Quiz Summary

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Results

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Categories

1. Question

According to FINRA rules regarding associated persons, what would be the registration status of a registered representative who has been called up for active duty service in the US Military?

2. Question

In instances in which a customer will be engaging in a viatical settlement of their insurance policy, with which policy will FINRA have a compliance concern?

3. Question

Under updated FINRA rules pertaining to communications with the public, these communications fall into which of the following categories?

I. Retail communication

II. Institutional communication

III. 3rd party material supplied to the member firm

IV. Correspondence

4. Question

With regard to prospectuses to be furnished to public customers purchasing open-end investment companies, which of the following descriptions of the rules are most accurate?

5. Question

Your member firm may become subject to FINRA’s Taping Rule under which of the following circumstances?

6. Question

FINRA rules require that a member firm must, at a minimum, retain its complaint file for how long?

7. Question

Your firm is engaged in offering retirement plan services to the public. You often recommend open-end investment company shares to your clientele as the most suitable way to begin investing in securities. Which of the following plans are considered non-qualified plans?

8. Question

When more than one individual wishes to open an account at a B/D, and the owners of the account shall have their share of the account pass to their estate in the event of death, the proper account type they’ll be directed to open is the:

9. Question

A registered rep is contacted by a client who instructs the RR to purchase $5,000 worth of the best performing growth fund which your firm makes available for sale. The rep can write up the order ticket for this client:

10. Question

None of the following qualify as securities as defined by the Securities & Exchange Commission with the exception of: