Which of the following scenarios describes activities that are disallowed under the NASAA Model Rules?
I. Broker-dealer Anon observes that a client placed a stop loss order to sell her 1,500 shares of
Amazon.com stock for $131 when the stock was selling for $134. Anon sold the stock for $133 when it
started to fall during the day and credited the client's account with $131 per share when stock dropped
further to $129 a share.
II. Penny is an agent with Broker-dealer Anon. She recently recommended that a client buy a stock that
Penny thought would do well. As it turned out, Penny was wrong, and she offers to refund the commission
that the client paid her.
III. Broker-dealer Anon is part of the selling group of a hot new IPO. As such, the firm purchases 50% of
the shares for its own portfolio and sells the remainder to the public.

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

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In order to maintain its registration with a state, a broker-dealer may be required to:
I. take a written or oral exam.
II. pay an annual filing fee.
III. maintain a minimum net capital.
IV. file all advertising material with the Administrator.

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

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You are a newly licensed agent and are making cold calls to generate business. According to the Telephone Consumer Protection Act of 1991 (TCPA), you may only place your calls between the hours of

• A.8 a.m. and 9 p.m., based on your time zone.
• B.8 a.m. and 9 p.m., based on your prospective customer's time zone.
• C.8 a.m. and 7 p.m., based on your prospective customer's time zone.
• D.8 a.m. and 7 p.m., based on the Pacific Time Zone.

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You are a registered agent with a large brokerage firm. Your client is a very busy woman. She is interested in purchasing 500 shares of Google, but she thinks this morning's opening price is too high. She's going to be in meetings and then on a transatlantic flight. She wants the purchase to take place today because she believes Google's price is just going to keep rising with only the occasional daily ups and downs. She wants you to use your discretion and try to get her the best price for the stock in today's trading session.
Which of the following statements are true?

• A.You have to tell her that you can't do this without a signed discretionary authorization from her, and there's none on file.
• B.You tell her that you can do this for her, but only if you execute it as a margin transaction.
• C.You tell her you can enter it for her as a "market not held" order.
• D.You tell her to have her secretary type up a discretionary authorization for her to sign and drop in the mail before she boards the plane. As long as the written authorization is in the mail, you can place the order.

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Which of the following is not a prohibited practice for a broker-dealer?

• A.waiting 36 hours before mailing a check after receiving a request for a cash withdrawal from a client if
  the client has that much cash available in his account
• B.requiring that a client who is engaged in margin transactions leave the securities with the broker-dealer
  in "street name"
• C.recommending a security to a new client without first ascertaining that client's level of risk tolerance
• D.executing a trade for an account holder based on instructions from the account holder's spouse

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