Reference no: EM133227552

1. On Monday, February 23", the shareholders of record will receive a dividend from FMD Company. On what date in February will the shares start trading ex-dividend? (No holidays in February)

a) Monday February 23

b) Wednesday February 18th

c) Thursday February 19th

d) Thursday February 26

2. Company A has a quarterly dividend of $0.60 and the market price is $40.00. Company B has an annual dividend of $1.40 and the market price is $32.00. Which of the following is NOT true?

a) Company A has a higher yield than Company B

b) Company B has a higher yield than Company A

c) The yield spread between the two companies is 1.62%

d) Cannot be determined from information given

3. What type of feature would a preferred share have if the dividend were in arrears?

a) Participating

b) Redeemable

c) Convertible

d) Cumulative

4. A company decided to issue new preferred shares instead of a new debt issue. Which of the following situations could be occurring:

I. The company has a low apparent tax rate

II.The company's debt/equity ratio is high

III.Investors are looking for new debt issues

IV. The company has assets available to pay dividends

a) I, Il and III

b) I, Il and IV

c) Il, Ill and IV

d) I only

5. In order to sell securities Short, a client must sign:

a A short torm

b) A letter of intent

C) A discretionary account form

d) Margin agreement

6. Which of the following statements is NOT true regarding margin accounts for long positions?

a) Reduced margin eligible securities have a maximum loan value of 70% of the market value

b) The stock trading at $1.45 has no loan value

c) Members of IIROC firms are allowed to have higher loan values for their better clients

d) All of the above are true statements