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Connie Serve placed an order to purchase five, $1,000 Treasury bonds in the secondary market on Tuesday, October 12th.
Connie will be required to pay for this purchase on which day?
Suggested Answer: D
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The true statement is that the separate account must register as an investment company under the Investment Company Act of 1940. The premiums paid by investors for variable life insurance (less numerous charges) are invested in subaccounts within the separate account, and the earnings of the subaccounts are used, in turn, to make payments to the owners of variable life insurance policies, but not to any of the other policyholders of the company, such as the fixed annuity investors. The insurance company pays its operating expenses out of its general account.
38 comments · newest first
BE
Beckie
11 months ago
No way it’s Thursday!
SH
Shawn
11 months ago
Seems right, but I’m not 100% sure.
AS
Ashlyn
12 months ago
I thought it was the same day?
TE
Terina
12 months ago
Definitely Wednesday, October 13th!
JE
Jeanice
1 year ago
Payment is usually due the next business day.
MA
Marsha
1 year ago
I’m a bit confused about the exact settlement dates. Could it be Thursday instead? I need to double-check my notes.
WI
Willow
1 year ago
This question feels familiar; I think we practiced a similar one in class. I want to say the answer is Wednesday.
RA
Rasheeda
1 year ago
I remember something about T+1 settlement for Treasury securities, but I'm not completely sure if that applies here.
YO
Youlanda
1 year ago
I think the payment for Treasury bonds usually settles on the next business day, so it might be Wednesday, October 13th.
KA
Kathrine
1 year ago
I'm pretty confident the answer is B. The question states Connie placed the order on Tuesday, October 12th, and in the bond market, the settlement is typically T+1, meaning the next business day. So she would have to pay for the bonds on Wednesday, October 13th.
CH
Chuck
1 year ago
Wait, I'm confused. Isn't the settlement period for Treasury bonds T+1, meaning one business day after the trade date? If that's the case, then the answer should be B, Wednesday, October 13th. I need to double-check that.
MA
Margart
1 year ago
Hmm, I'm a little unsure about this one. The question is asking when Connie has to pay, but it doesn't explicitly say when the settlement date is. I'll have to think this through carefully and review my notes on bond trading settlement periods.
LO
Lorrie
1 year ago
This seems pretty straightforward. The question is asking when Connie has to pay for the bonds, and the information given is that she placed the order on Tuesday, October 12th. So I'm guessing the answer is B, Wednesday, October 13th.
AL
Aleisha
1 year ago
Okay, I think I've got this. Since Connie placed the order on a Tuesday, the settlement would typically be two business days later, which would be Thursday, October 14th. So the answer is C.
BU
Buddy
2 years ago
I'm going with D. Two business days after the trade date sounds about right, even though I'm more familiar with stock market settlements.
LE
Leota
1 year ago
D) Friday, October 15th.
CA
Caren
1 year ago
I think it's D too. That's the standard settlement time for most securities.
RE
Rebecka
1 year ago
D) Friday, October 15th.
LY
Lynelle
1 year ago
C) Thursday, October 14th.
NO
Novella
1 year ago
B) Wednesday, October 13th.
NA
Natalie
1 year ago
A) Tuesday, October 12th.
ZA
Zana
2 years ago
Well, if Connie is buying on Tuesday, I'd assume the settlement would be on Thursday, not Friday. These bond market rules are tricky.
DO
Dominga
2 years ago
Haha, Connie must be a bond trader or something. I'm just a regular Joe, so this stuff is Greek to me!
OD
Odette
1 year ago
C) Thursday, October 14th.
DE
Delfina
1 year ago
B) Wednesday, October 13th.
BE
Bea
1 year ago
D) Friday, October 15th.
JA
Jacqueline
1 year ago
C) Thursday, October 14th.
VI
Viola
1 year ago
A) Tuesday, October 12th.
DE
Denae
2 years ago
B) Wednesday, October 13th.
LY
Lynette
2 years ago
A) Tuesday, October 12th.
LY
Lynsey
2 years ago
I'm not sure, but I think it's Thursday, October 14th. Can someone explain why it's not Wednesday?
ST
Stephaine
2 years ago
I agree with Latosha, because T+1 settlement means payment is due the next business day.
LA
Latosha
2 years ago
I think Connie will have to pay on Wednesday, October 13th.
LI
Lilli
2 years ago
The correct answer is D) Friday, October 15th. Bonds are usually settled two business days after the trade date.
WI
Willow
1 year ago
D) Friday, October 15th.
TE
Telma
1 year ago
C) Thursday, October 14th.
LE
Leota
1 year ago
B) Wednesday, October 13th.
GE
Georgeanna
1 year ago
A) Tuesday, October 12th.