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WorksheetsFinra Sie (Week One)
Total questions: 22
Worksheet time: 22mins
What does FINRA stand for?
Financial Network Regulatory Agency
-Federal Investment Regulation Authority
Financial Industry Regulatory Authority
Finance National Reporting Association
How does the SEC relate to FINRA?
The SEC manages all broker-dealer regulations directly.
The SEC delegates regulatory responsibilities to FINRA.
FINRA reports directly to the Federal Reserve, not the SEC.
The SEC only oversees stock exchanges, not FINRA.
What entities are regulated by FINRA?
All public corporations
Banks and insurance companies
Broker-dealers and registered representatives
Mutual funds and pension plans
What is the definition of a security?
An investment that can only be bought and sold by the government.
An investment that can be bought, sold, or gifted.
A contract between two corporations.
A financial product that only generates interest.
Which of the following is NOT a type of security?
Bonds
Real Estate
Common Stock
Cryptocurrency
How does real estate generate income?
Through interest payments
By dividends issued by the government
By renting or leasing properties
By issuing bonds to tenants
What does principal preservation focus on?
Maximizing returns through high-risk investments
Protecting the initial investment
Buying and selling assets frequently
Investing in cryptocurrency for high returns
What is capital appreciation?
The act of buying low and selling high to increase an investment’s value
The depreciation of asset value over time
The interest earned from a savings account
The profit made from selling an asset at a higher price
What are capital gains?
Profits from selling an investment at a higher price than it was purchased
Interest earned from government bonds
Dividends paid to shareholders
Losses from selling an investment at a lower price than it was purchased
What is an IPO
Initial Public Offering
Investment Portfolio Opportunity
Internal Payment Option
Individual Public Order
Where does an IPO occur?
In the secondary market
In the futures market
In the primary market
On a cryptocurrency exchange
How does supply and demand affect stock prices?
More supply increases the price.
More demand lowers the price.
Supply and demand have no effect on stock prices.
Higher demand increases the price, while higher supply lowers it.
What is authorized stock?
Shares sold to the public on the secondary market.
The number of shares a company can issue according to its charter.
Shares held by a company’s executives.
Shares that have been repurchased by the company.
What is the difference between issued stock and outstanding stock?
Issued stock is held by the public, and outstanding stock is held by executives.
Issued stock refers to all shares sold, while outstanding stock refers to shares currently held by investors.
Issued stock is repurchased stock, while outstanding stock is all available stock.
There is no difference between issued and outstanding stock.
What is treasury stock?
Shares that have never been sold to the public.
Shares that are held by investors in the secondary market.
Shares that have been repurchased by the company.
Shares that have been sold in an IPO.
Which company would likely be classified as large-cap?
A local coffee shop
A company with a market cap under $1 billion
A company with a market cap of over $10 billion, like Apple
A startup tech company with no revenue
Which type of stock is generally riskier and offers lower dividends?
Large-cap stock
Mid-cap stock
Penny stock
Small-cap stock
What is a penny stock?
A large-cap stock with significant dividends
A stock with a price of less than $5 per share and often not listed on major exchanges
A stock listed on NASDAQ with high volatility
A type of government bond
What is the difference between secured bonds and unsecured bonds?
Secured bonds are government-issued, while unsecured bonds are corporate.
Secured bonds offer higher returns than unsecured bonds.
Secured bonds are backed by collateral, while unsecured bonds (debentures) are not.
There is no difference between secured and unsecured bonds.
What is a preferred stock?
A stock that only pays dividends during profitable years.
A stock with voting rights but no dividends.
A type of bond issued by private corporations.
A type of stock that usually pays fixed dividends before common stock dividends.
What are cash dividends?
Dividends paid out in the form of additional shares
Interest earned from savings accounts
Bonuses given to company executives
Payments made to shareholders from company profits
What is the difference between cash dividends and stock dividends?
Cash dividends are payments in cash, while stock dividends are additional shares.
Cash dividends are only paid to executives, while stock dividends are paid to public shareholders.
Stock dividends are paid regularly, while cash dividends are paid annually.
Cash dividends represent company profits, while stock dividends represent losses.
