NewWave Investments, a family of mutual funds, hires the star of a new motion picture about the
workings of Wall Street to provide a testimonial as part of NewWave's new television ad campaign. The
actor's financial adviser has, in fact, invested some of the actor's monies in NewWave's funds. NewWave
provides the actor with a script in which the actor explains the concept of dollar cost averaging to the
viewers. At the conclusion of the actor's explanation, the viewers are informed that the actor has been
paid for his testimonial, that his experience may not be representative of that of other clients, and that past
performance is no guarantee of future performance. Based on these facts:

• A. NewWave has violated no rules; it has complied with all of FINRA's disclosure requirements.
• B. NewWave has violated a FINRA rule stipulating that testimonial providers can receive no payment for
  their testimonies.
• C. NewWave has violated a FINRA rule that prohibits testimonials of public figures from being used in
  advertisements.
• D. NewWave has violated a FINRA rule requiring that any testimonial that contains a technical aspect
  related to investing must be given by someone who has both the knowledge and experience to hold a
  valid opinion on the topic.

Simple Simon owns 1,000 shares in the Pasty Pie Corporation, which has just declared a stock dividend
of 5%.Just prior to this announcement, Pasty Pie was selling for $10 a share. This announcement will:

• A. increase Pasty's shares outstanding and reduce Simple's proportionate ownership in the firm.
• B. increase the number of shares that Simple owns to 1,050, but this will not affect the market value of
  Simple's holdings.
• C. increase Simple's cash by the amount of the dividend paid: 0.05 x $10 = $0.50 x 1,000 shares = $500.
• D. increase the number of shares that Simple owns to 1,050, which will increase the market value of the
  shares that he owns from $10,000 to $10,500.

Tex Payor purchased his shares of Invest4U Mutual Fund 30 days prior to its ex-dividend date. In order
for any dividends he receives from the fund to be qualified, Tex cannot sell his shares until:

• A. six months after the settlement date of his purchase.
• B. one day after the fund's ex-dividend date.
• C. twelve months after the settlement date of his purchase.
• D. thirty-one days after the fund's ex-dividend date.

Which of the following statements about specialists is false?

• A. Specialists are required to maintain a fair and orderly market in their assigned stocks, meaning that
  they must buy if there is an excess of sell orders and sell out of their own portfolios if there is an excess of
  buy orders.
• B. Specialists are employees of the exchange on which they oversee trades.
• C. In addition to acting as market makers, specialists also act as agents and execute limit orders placed
  by commission brokers for their clients if the specified price is reached.
• D. Specialists are market makers in assigned stocks and, as such, can profit from these investments.

The Securities Exchange Act of 1934:
I. regulates the market for new issues.
II. delineates the registration requirements for investment advisers.
III. regulates secondary market activities.
IV. requires that officers and some other employees of member firms submit their fingerprints to the U.S.
attorney general's office.

• A. II and III only
• B. I, II, III, and IV
• C. III and IV only
• D. I and II only