Study with Series6 Actual Test Questions

FINRA Series6 Exam Overview:

FINRA Series6 Exam Syllabus Topics:

FINRA Investment Company and Variable Contracts Products Representative Examination (IR) Sample Questions:

1. Simple Simon owns 1,000 shares in the Pasty Pie Corporation, which has just declared a stock dividend
of 5%.Just prior to this announcement, Pasty Pie was selling for $10 a share. This announcement will:

A) increase Simple's cash by the amount of the dividend paid: 0.05 x $10 = $0.50 x 1,000 shares = $500.
B) increase the number of shares that Simple owns to 1,050, but this will not affect the market value of
Simple's holdings.
C) increase Pasty's shares outstanding and reduce Simple's proportionate ownership in the firm.
D) increase the number of shares that Simple owns to 1,050, which will increase the market value of the
shares that he owns from $10,000 to $10,500.

2. When a client purchases a variable contract through you, he should be informed that his money will be
invested:

A) in a product with a guaranteed cash value.
B) at the next price that is computed after the contract application is accepted by the insurance company.
C) at the most recent price for which the contract sold.
D) at the previous day's close price for the contract.

3. The essential difference between a 401(k) plan and a 403(b) plan is that:

A) only employers can contribute to 403(b) plans while both employers and employees can contribute to
4 01(k) plans.
B) the 403(b) plan is for employees of specific non-profit organizations whereas the 401(k) plan is for the
employees of private corporations.
C) contributions to 403(b) plans are always tax deductible, which is not the case with 401(k) plan
contributions.
D) the 403(b) plan is for small businesses while the 401(k) plan is for large corporations.

4. Matt is a registered representative with Fine, Howard, Fine and Associates. Tom, an old fraternity brother,
is one of his clients. Business has been bad, and Matt is going to have difficulties making this month's
mortgage payment. Tom was commiserating with him when the two hooked up to have a couple of beers
together and offered to lend Matt some money to see him through the rough times. Based on these facts:

A) Matt can accept the offer as long as Tom will not need to sell any investments to lend Matt the money.
This would constitute a conflict of interest.
B) Matt can accept the offer without having to obtain pre-approval from his employer since he and Tom
are former fraternity brothers and their friendship pre-dates their agent/client relationship.
C) Matt must refuse Tom's offer since Tom is one of his clients.
D) Matt can accept Tom's offer, but only after obtaining pre-approval from Fine, Howard, Fine.

5. Under the Investment Company Act of 1940, an investment company must:

A) provide a prospective investor with a copy of its registration statement when offering shares for sale.
B) have a board of directors composed of no more than 50% who are "interested persons."
C) maintain a minimum net worth of $5 million.
D) include a statement of its investment policy in its prospectus.

Solutions: