Chapter 5 Practice Questions
1. The MSRB charges a transaction fee on municipal transactions. Assuming an inter-dealer transaction, who pays the transaction fee?
A. Each broker-dealer must pay 0.001%, or $0.01 on every $1,000 of par value.
B. The seller only must pay 0.001%, or $0.01 on every $1,000 of par value.
C. Each broker-dealer must pay 0.003%, or $0.03 on every $1,000 of par value.
D. The seller only must pay 0.003%, or $0.03 on every $1,000 of par value.
2. The MSRB charges a technology fee on municipal transactions. Assuming an inter-dealer transaction, who pays the technology fee and how much is it?
A. Each broker-dealer must pay 0.001%, or $0.01 on every $1,000 of par value.
B. The seller only must pay 0.001%, or $0.01 on every $1,000 of par value.
C. Each broker-dealer must pay $1.00 on each transaction.
D. The seller only must pay $1.00 on each transaction.
3. A customer buys 150 municipal bonds with a par value of $1,000 each from a municipal securities dealer. The MSRB charges a transaction fee on municipal transactions. Who will pay this fee and how much will it be?
A. Both the customer and the dealer will each pay $1.00 on the transaction.
B. The dealer only will pay $1.00 on the transaction.
C. Both the customer and the dealer will each pay $1.50 on the transaction.
D. The dealer only will pay $1.50 on the transaction.
4. A customer buys 200 municipal bonds with a par value of $1,000 each from a municipal securities dealer. The MSRB charges a technology fee on municipal transactions. Who will pay this fee and how much will it be?
A. Both the customer and the dealer will each pay $1.00 on the transaction.
B. The dealer only will pay $1.00 on the transaction.
C. Both the customer and the dealer will each pay $2.00 on the transaction.
D. The dealer only will pay $2.00 on the transaction.
5. A customer buys 150 municipal bonds with a par value of $1,000 each from a mun