[Aug 15, 2023] Series-7 Exam Dumps, Series-7 Practice Test Questions [Q74-Q90]

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[Aug 15, 2023] Series-7 Exam Dumps, Series-7 Practice Test Questions

Free Series-7 Study Guides Exam Questions and Answer

FINRA Series-7 (General Securities Representative Qualification Examination (GS)) Certification Exam is a crucial certification for anyone interested in working in the securities industry. Series-7 exam is designed to test the knowledge and skills of individuals planning to work as general securities representatives. General Securities Representative Qualification Examination (GS) certification exam is administered by the Financial Industry Regulatory Authority (FINRA), which is a self-regulatory organization responsible for regulating the securities industry in the United States.

FINRA Series-7 (General Securities Representative Qualification Examination (GS)) is a challenging and comprehensive exam that is designed to test the knowledge and skills of individuals who wish to become a general securities representative. It is a requirement for individuals who wish to work in the securities industry and is highly respected by employers in the financial industry.

NEW QUESTION 74
Securities may be sold under SEC rule 144 provided that the following conditions are met:

the company files regular financial data with the SEC

they are sold in agency transactions only

they are sold in principal transactions only

both A and B

Explanation/Reference:
Explanation: the company files regular financial data with the SEC. Rule 144 transactions may use either agency or principal methods.

NEW QUESTION 75
Which of the following municipal bonds may be grouped under the classification of “revenue bonds”?

special tax

new housing authority

general obligation

limited tax

special tax. The other categories are not revenue bonds. Special tax is the only type that fits the general grouping.

NEW QUESTION 76
The market theory stating that the small investor is usually wrong is called the:

advance-decline theory

odd-lot theory

Dow theory

short interest theory

The market theory stating that the small investor is usually wrong is called the odd-lot theory. The concept behind this theory is that when small lot sales are high, it is a good time to buy, as a high ratio of small business sales is a contrary indicator of market direction.

NEW QUESTION 77
A registered bond with “Happy Birthday” scrawled across the face of the certificate is delivered to a broker/ dealer in satisfaction of sale by another member firm. Assuming it is accompanied by an authentic assignment, power of substitution form, and tax stamps (if appropriate), this is good delivery only if:

the certificate is validated by the transfer agent

the certificate is validated by the registered owner

the marking did not cover the name of the registered owner or the principal amount of the bond

this is not a good delivery under any circumstances

Explanation/Reference:
Explanation: the certificate is validated by the transfer agent. A mutilated bond must be validated before it can be a good delivery. The validation can be made by the issuer or the transfer agent.

NEW QUESTION 78
Municipalities are most likely to issue notes for which of the following purposes?

repairs to infrastructure

federal income tax payments

short-term cash needs

long-term financing

short-term cash needs. Notes are generally used for short-term needs.

NEW QUESTION 79
Regulation T is set at 50%. Bubba’s account contains long positions in the following securities with the prices listed:
100 ABC $30
200 XYZ $70
200 QBB $40
200 KKK $25
Total market value = $30,000
Debit balance in the account = $12,000
Net equity balance of the account = $18,000
What is the buying power in Bubba’s account?

$3,000

$6,000

$11,000

Explanation/Reference:
Explanation: $6,000. Divide Bubba’s excess equity by the Reg T margin requirement of 50%.

NEW QUESTION 80
Crossover is best defined as:

the point at which the program becomes profitable

the point at which income exceeds deductions

the fact that there are more general partners than limited partners

the profit of limited partners exceeding profit of general partners

the point at which income exceeds deductions. This is the definition of “crossover”.

NEW QUESTION 81
A tax shelter specifically designed for small employers is:

an IRA

a SIMPLE

a subsidized deferral plan

a Shelter Island plan

a SIMPLE. IRAs are for any individuals, not just small employers. The other choices do not exist.

NEW QUESTION 82
Regulation T is set at 50%. Bubba’s account contains long positions in the following securities with the prices listed:
100 ABC $30
200 XYZ $70
200 QBB $40
200 KKK $25
Total market value = $30,000
Debit balance in the account = $12,000
Net equity balance of the account = $18,000
What is Bubba’s excess equity in the account?

$3,000

$18,000

$12,000

$3,000. With Reg T at 50%, Bubba’s equity should be half of the $30,000 account value, which is $15,000. Since his equity is $18,000 Bubba has $3,000 of excess equity.

NEW QUESTION 83
Which of the following securities has the highest amount of market risk?

US treasury bills

US treasury certificates

US treasury notes

savings bank deposits

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.

NEW QUESTION 84
Bubba Corporation has 3,500,000 shares of common stock outstanding and its trading volume in the few weeks has been as follows:
Week 1 – 43,000
Week 2 – 30,900
Week 3 – 37,500
Week 4 – 42,600
Week 5 – 33,000 (the most recent week)
If an affiliated person wanted to liquidate some of his holding of 100,000 shares pursuant to SEC Rule 144, how many shares could he sell?

35,000

36,000

37,400

38,500

Explanation/Reference:
Explanation: 36,000. Under Rule 144 up to one percent of the outstanding shares or the average weekly volume for the preceding four weeks, whichever is greater. The total volume for the last four seeks was
144,000 shares. The average is therefore 36,000 shares. This is greater than one percent of the shares outstanding (35,000).

NEW QUESTION 85
Which of the following is not good delivery on a sale of 470 shares?

47 10-share certificates

4 100-share certificates and one 70-share certificate

8 50-share certificates, one 40-share certificate, and one 30-share certificate

2 100-share certificates and 3 90-share certificates

2 100-share certificates and 3 90-share certificates. Three 90-share certificates are not good delivery because they cannot be combined into 100-share amounts.

NEW QUESTION 86
Bubba buys 100 shares of XYZ stock at $40 per share and sells a listed July XYZ call at 45 for a $2 premium.
What is his loss potential?

$3,800

$4,000

$4,200

$4,500

Explanation/Reference:
Explanation: $3,800. If the stock declined to $0, Bubba would lose $4,000 from having purchased the stock less the $200 premium he received from selling the call option.

NEW QUESTION 87
Which of the following is normally the largest asset of a manufacturing company?

sales

inventory

accounts receivable

notes receivable

Inventory. A manufacturer will normally have more inventory than accounts receivable and notes receivable. Sales is not an asset category.

NEW QUESTION 88
What does the bond buyer placement ratio represent?

the amount of municipal bonds held by banks and insurance companies as a percentage of municipal bonds outstanding

the amount of municipal bonds distributed weekly as a percentage of each week’s new issue accounts of more than $1 million

the amount of municipal bonds offered in the daily Blue List as a percentage of the day’s new issue amounts of more than $1 million

the par value amount of municipal bonds offered in the Blue List as a percentage of the 30 -day visible supply for competitive and negotiated issues

the amount of municipal bonds distributed weekly as a percentage of each week’s new issue accounts of more than $1 million. This is the definition of the ratio.

NEW QUESTION 89
Bubba buys $100,000 of US Treasury 10½ s of 31 on margin. If the current market price is 92.16, what is Bubba’s minimum deposit requirement?

$4,625

$5,550

$10,000

$25,000

$5,500. The NYSE maintenance requirements on obligations of the US treasury vary depending upon the term of the instrument. For 20-year bonds, the requirement is 6% of the market value. Multiplying the market value of $92,500 by 6% equals $5,500.

NEW QUESTION 90
Which of the following organizations usually has a prominent role in guiding investment policies of mutual funds?

the plan company

the management group

the custodian bank

the underwriter

Explanation/Reference:
Explanation: the management group. The management group is actually comprised of the management company (including the underwriter) and the investment advisor.

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