Chapter 6 Practice Questions
- 1. When must a broker-dealer deliver a DK notice?
- A. When it receives a confirmation for a transaction it does not recognize or accept
- B. When an aged fail to deliver goes over 13 settlement days
- C. When a firm does not recognize an account transfer on ACATs
- D. When a firm cannot validate an account transfer on ACATs
- 2. Identify the correct chronological order of the important dates relating to payment of stock dividends.
- A. Declaration, Record, Ex-dividend, Payable
- B. Record, Ex-dividend, Declaration, Payable
- C. Declaration, Ex-dividend, Payable, Record
- D. Declaration, Ex-dividend, Record, Payable
- 3. Which of the following would not be considered a flat bond?
- A. A zero coupon bond
- B. A bond that is in default
- C. A bond with accrued interest
- D. A bond that settles on the same day that interest is paid
- 4. When are due-bills used?
- A. When a security traded before the ex-date is delivered on or before the record date
- B. When a security traded after the ex-date is delivered on or before the record date
- C. When a security traded before the ex-date is delivered too late for transfer on or before the record date
- D. When a security traded after the ex-date is delivered too late for transfer on or before the record date
- 5. Interest begins accruing on a when-issued contract sold in the secondary market:
- A. On the delivery date
- B. On the first business day after the last interest payment
- C. On the trade date
- D. On the record date
- 6. An assignment does not constitute a good delivery when any of the following is true except:
- A. It is not guaranteed by a participant in the NYSE Medallion or similar program
- B. The signature does not exactly match the name on the certificate
- C. The power of attorney resides in the U.S. but is not a U.S. citizen
- D. The securities to be assigned have a foreign issuer
- 7. Which of the following fac