Chapter 3 Practice Questions
1. John is a representative who works for a bank dealer. Records of John’s correspondence with the public pertaining to municipal securities activities must be maintained for:
A. Six years
B. Three years
C. Two years
D. Six months
2. The opening of a customer account involving municipal securities must be reviewed and approved of by:
A. Only a Municipal Securities Representative
B. A Municipal Securities Principal or General Securities Principal
C. A Municipal Securities Sales Principal, Municipal Securities Principal, or General Securities Principal
D. A Municipal Securities Principal
3. Suitability information refers to:
A. Only information about a customer’s financial status
B. Information necessary to open a suitable customer account
C. Only information about a customer’s investment objectives
D. Information necessary to be able to recommend suitable transactions to a particular customer
4. Municipal securities dealers are required to maintain records of customer complaints for:
A. Six years
B. Three years
C. Two years
D. Four years
5. Which of the following is a true statement about opening customer accounts?
A. Dealers must obtain all the required customer information before effecting any transactions in the account.
B. More information must be obtained for institutional accounts than other customer accounts.
C. A customer’s signature is not required on the new account form to open the account.
D. Suitability information must be provided to open the account.
6. All of the following statements about municipal securities accounts for customers employed by another broker-dealer are correct except:
A. Such accounts are strictly prohibited unless the firm receives prior approval from the customer’s employing firm.
B. To open such an account, the broker or dealer must first provide written notice to the customer’s employing firm.
C. Fo