Chapter 6 Practice Questions
- 1. The Time of First Execution is:
- A. The deadline for sending a commitment wire
- B. The time the issuer publicly announces its selection of an underwriter
- C. Required to be at least three business hours after all required information has been transmitted to the MSRB and DTC reporting facilities
- D. The time the underwriter plans to execute its first transactions for the new issue
- 2. Which of the following statements about an underwriter’s disclosure obligations to customers of municipal securities transactions is correct?
- A. Underwriters must deliver a copy of the official statement to their customers no later than the settlement of the transaction.
- B. In a negotiated sale, the underwriter has no additional disclosure obligations.
- C. In the sale of a municipal fund security, underwriters may deliver an official statement to a customer by informing them that it is available on EMMA.
- D. If an official statement is not being prepared, the underwriter has no obligation to disclose this.
- 3. All of the following statements about advance refunding are correct except:
- A. Advance refunding documents must be submitted to EMMA.
- B. Advance refunding is a process where the issuer of refunding bonds seeks to lower its interest payments by paying off previously issued bonds with newly issued bonds.
- C. Underwriters must submit the required information related to advance refunding no later than ten days after the closing date.
- D. A primary offering may be used to advance refund outstanding municipal securities.
- 4. If a new issue is a private placement, sold to no more than 35 sophisticated securities investors:
- A. No underwriter is required.
- B. It is exempt from filing an official statement with EMMA.
- C. It is considered a remarketing of municipal securities.
- D. The underwriter is not requir