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1)After a company splits its common shares, the amount of retained earnings shown on

its balance sheet will be ___________ before the share split.

a) Higher than

b) Lower than

c) The same as

2) When the straight-line method is used, depreciation expense during the earliest

years of an assets life is ___________ it is in later years.

a) Higher than

b) Lower than

3) Once an issue has been approved and can be sold to the public, it is said to be:

a) Green sheeted

b) Red skied

c) Grey approved

d) Blue skied

4) The TSX would likely suspend a companys trading under which of the following

conditions?

a) Proposed merger talks

b) All outstanding shares are redeemed

c) Failure to file financial statements on time

d) Announcing higher than expected earnings

c) The same as

5) Full, true, and plain disclosure of all material facts is:

a) Included in the red herring

b) Required in the final prospectus

c) Arranged with the issuer by the selling group

d) Not required for Prospectus approval

6)RKM Company has never gone to the market and wants to do some financing that

will be done publicly. It will do a(n):

a) Offering memorandum

b) Initial Public Offering

c) Placement memorandum

d) Outside memorandum

7) On Monday, February 23rd, 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 23rd

b) Wednesday February 18th

c) Thursday February 19th

d) Thursday February 26^th

8)What best describes a laddered bond portfolio?

a) An account where yields reflect periodic interest rate changes in the market

b) An account whose rate of return is guaranteed by a strip bond

c) An account whose rate of return is linked to an equity benchmark

d) An account in which maturities are segmented with one term maturing each year

9)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

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