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FINRA Investment Company and Variable Contracts Products Representative Examination (IR) Sample Questions:
1. Which of the following share classes do not have front-end loads?
A) Class A
B) Class C
C) Neither Class B nor Class C shares have front-end loads.
D) Class B
2. Patty Planner has been contributing a sum to a non-qualified variable annuity each month for the last
fifteen years in order to reach her ultimate goal of an early retirement. Now that she has turned 60, Patty
has decided to retire. Her annuity is now worth $69,000, and her total contributions were $36,000.Patty
decides to withdraw $15,000 of her accumulation as a lump sum to fund an extended vacation to Europe
that she has always promised herself. Which of the following statements applies to Patty's situation?
A) Her $15,000 withdrawal will be taxed as capital gain income, at a preferential rate, but she will also
have to pay a 10% penalty for withdrawing the funds prior to turning 62.
B) Her $15,000 withdrawal is not taxable since it is less than the amount of her total contributions to the
plan, but she will be subject to a 10% penalty for early withdrawal.
C) Her $15,000 withdrawal will be taxable as ordinary income to her at her marginal tax rate, and she will
also be subject to a 10% penalty for early withdrawal.
D) Her $15,000 withdrawal will be taxed as ordinary income to her at her marginal tax rate.
3. Which of the following would be the most suitable investment for a client who has retired and needs some
current income to augment her social security check?
A) variable life policy
B) growth fund
C) money market fund
D) U.S. government bond fund
4. Upon receiving a complaint about one of its member firms, FINRA may:
I. require any person associated with the member firm to provide information to FINRA and to testify under
oath.
II. inspect and copy the books, records and accounts of the member firm.
III. share information obtained from its investigation of a member firm with a foreign regulatory agency.
A) II only
B) II and III only
C) I, II, and III
D) I and II only
5. Which of the following would be required to register as an investment company?
I. a non-diversified management company
II. a unit investment trust
III. a face-amount certificate company
A) II only
B) II and III only
C) I, II, and III
D) I and II only
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: D | Question # 3 Answer: D | Question # 4 Answer: C | Question # 5 Answer: C |


