a $600 loss. The strike price and Bubba’s purchase price are the same. He has a $600 loss on the

option for the premium he paid.

$100,000. This was a considerable amount of money in 1940.

execute sell orders but do not accept buy orders or distribute assets from the account until a new

partnership agreement is provided to the brokerage. Sell orders may be accepted but not buy orders

or distributions.

US treasury notes. Savings bank deposits have no risk. The short duration of treasury bills and

certificates embodies less market risk than longer-term treasury notes.

takedown. The takedown is an additional allowance on bonds sold by a member.

adjustment bonds. These bonds are also known as income bonds. Interest is paid only if there is

income.

the buyer is given one-day notice in writing. A contract made on a “seller’s option” may be

terminated by the seller at an earlier date, provided that he gives the buyer one-day notice.

specialists. This description defines the function of the specialists.

convertible preferred. Because of the conversion feature, convertibles are more closely linked to the

price of the common stock. In addition, since the dividend rate on convertible preferred is usually

lower than other preferred issues, the convertibles are more sensitive to interest rate fluctuations.

it turns potential capital gains into current taxable income. Recapture is taxed as ordinary income,

not capital gain. The other choices are not true.