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Series 66 Benchmark exam wrong questions _ (DETAILED 100- SURE ANSWERS) 2024
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Series 66 Benchmark exam wrong questions _ (DETAILED 100- SURE ANSWERS) 2024
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8/5/24, 8:32 AMSeries 66 Benchmark exam wrong questions
Jeremiah
Terms in this set (59)
use the dividend growth model as it will produce the best valuation
Company XYZ is a mature company in an To value a company's stock price when it pays a growing dividend, the dividend growth
established industry. The company has model is most appropriate. It is more important to know when to deploy this formula as
experienced increased demand for its opposed to the formula itself. The dividend discount model is most appropriate shares
products, and the CEO and Chairman of the that are paying a stable (non-growing) dividend. All things being equal, the dividend
Board will jointly announce an increase in its growth model will produce a higher valuation than the dividend discount model. Both
long-standing dividend of 2.5% per year on a of these valuations are fundamental in nature. Two technical analyses are the
going forward basis. An analyst valuing advance/decline line and moving averages. The advance/decline line indicates overall
Company XYZ's stock should market movements by plotting the number of stocks that have gained value versus lost
value on a daily basis. A moving average plots the average price of a stock over a
historical period, e.g. the average price of a stock during the past 50, 100, or 200 days.
ABC's stock has appreciated dramatically The client should not purchase the post-split ABC shares if he believed the pre-split
over the past few years and is trading at ABC shares were overvalued.
$1,000 per share. A client who purchased 100
shares of ABC years earlier at a much lower A stock split does not create or destroy value; therefore, the stock split should not have
price still believes in the company's any impact on the client's decision to purchase stock. After the split the value of one
management and products, but thinks the $1,000 share ($1,000 in value) will be exactly the same as the value of ten $100 shares
stock is overvalued at $1,000 per share. If ($1,000 in value). Therefore, if the client thought the stock was overvalue at $1,000 he
ABC executed a 10:1 stock split, which of the must also think ten shares of $100 are overvalued and should not be purchased.
following statements would be most
accurate?
An adviser recommends a security to her The clients' basis in the shares will be adjusted downwards to account for the stock
clients who are seeking growth and capital dividend.
appreciation. She makes a recommendation
for a stock that costs $20 per share. Many of A stock dividend does not change the economics of an investment; the investor now
her clients accepted the recommendation holds the same value, but it is spread across more shares (here 10% more shares).
and make the purchase. Shortly thereafter, Because the investment is now spread across more shares the cost basis of each share
the company's board declares a 10% stock must be adjusted downwards. This will happen at the time of the dividend, though no
dividend. Which of the following statements tax is payable unless and until those shares are sold. Receiving a stock dividend does
accurately describes this investment? not result in a gain to the investor, nor is it an option or right to purchase more shares.
Series 66 Benchmark exam wrong questions
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, 8/5/24, 8:32 AM
serves as a partner, officer, or director of the firm with exclusive responsibility for
information technology
Under the USA, an individual is NOT an
Partners, officers, and directors of a broker-dealer are considered agents if they are
agent if he is employed by a broker/dealer
involved in the purchase or sale of securities. They are also required to register if they
and only
supervise agents. All individuals who are employed by the broker-dealer and are
involved in securities transactions are required to register as agents of the broker-
dealer.
A corporation that sells interests in an oil and gas limited partnership to qualified
investors
Which of the following persons, natural or
corporate, fall under the definition of a
A broker-dealer is a person that buys and sells securities for its own account and for
broker/dealer under the Uniform Securities
the accounts of others. Agents, issuers, and commercial banks (which include credit
Act?
unions, savings and loans, and thrifts), are specifically excluded from the definition of a
broker-dealer.
Registered agents employed with a II and III
broker/dealer registered in California
regularly mail sales material to 4 clients in Broker-dealers are required to register in the state if they have an office in the state or
Oregon. The California broker/dealer if they have a single resident client in the state, without exception. Note that Investment
I. need not register in Oregon until it has 5 or Advisers can avoid registration in a state if they do not have an office in the state and
more clients in Oregon have fewer than 6 retail clients in a given year.
II. must register in California
III. must register in Oregon
IV. must register in all states from which it
receives any mail from clients
I, III and IV
An Administrator may deny or revoke a
For an Administrator to deny or revoke a registration it must have 2 reasons to do so,
registration if he finds a broker/dealer I. is
with one of the reasons being that it is in the public's best interests. Reasons include
insolvent
insolvency (meaning the firm cannot meet its financial obligations), conviction of a
II. has no agents in its employ
securities or money related crime within the last 10 years, or if another state prohibits
III. was convicted of a felony 9 years ago
the firm from participating in the securities industry. There is no specific rule that
IV. is under an injunction from another state
authorizes the Administrator to deny or revoke a registration if it does not employ any
agents.
The sales of securities and must be registered under the Uniform Securities Act
If an automobile dealer offers registered
securities as an integral part of the price of
According to the definition of a sale, a security offered as a bonus with the purchase of
the automobiles he sells, the dealer is
a retail item would be considered a sale. This sale would thus be subject to the
engaged in which of the following?
provisions of the Uniform Securities Act.
suspend an agent's registration without an opportunity for a hearing
The powers of the Administrator include conducting investigations inside and outside of
The USA permits the Administrator to do all their own state, issuing subpoenas and continuing investigations at their own discretion.
of the following EXCEPT However, if an Administrator suspends or revokes a registration it must offer the
opportunity for a hearing within 15 days of written request by a respondent. If the
Administrator suspects fraud has occurred or is about to occur, a cease and desist
order can be issued without a hearing
Series 66 Benchmark exam wrong questions
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