Pre-Summer Special Limited Time 70% Discount Offer - Ends in 0d 00h 00m 00s - Coupon code = getmirror

Home
FINRA
General Securities Representative
Series-7
Series 7 General Securities Representative Qualification Examination (GS) Questions and Answers

Pass the FINRA General Securities Representative Series-7 Questions and answers with ExamsMirror

Practice at least 50% of the questions to maximize your chances of passing.

Exam Series-7 Premium Access

View all detail and faqs for the Series-7 exam

Go to Exam

7918 Students Passed

95% Average Score

96% Same Questions

Viewing page 12 out of 12 pages

Viewing questions 111-120 out of questions

Questions # 111:

The amount for which the securities of a close-end investment company are selling above net asset value is know as:

Options:

premium

discount

commission

sales charge

Answer

Explanation

premium. The price of closed-end investment companies is determined by trading of their shares in the open market. The price may be a discount to net asset value or a “premium” above net asset value.

Questions # 112:

All sales literature and advertising relating to investment company shares prepared by members of FINRA must be filed for review with which of the following?

Options:

Anti-Trust Division of the Justice Department

SEC

Federal Reserve Board

FINRA

Answer

Explanation

FINRA. Sales literature regarding investment company shares must be filed with FINRA within three days after the first use.

Questions # 113:

Which of the following forms of underwriting is least likely for an offering of municipal bonds?

Options:

negotiated

competitive bid

firm commitment

best efforts

Answer

Explanation

best efforts. A best efforts deal least likely for a municipal securities offering. It is most often associated with small corporate stock or limited partnership offerings. Municipal securities are usually competitive bid or negotiated. Both of these types are firm commitment.

Questions # 114:

The maximum contribution an employer may make to a SEP-IRA is:

Options:

$4,000

$5,000

25% of employee compensation

100% of employee compensation

Answer

Explanation

25% of employee compensation. There is also a dollar cap that is has an annual cost-of-living adjustment.

Questions # 115:

With the Regulation T requirement at 50%, a firm wishes to impose house rules that require a minimum equity of 40%.

Which of the following is true?

Options:

this cannot be implemented because the level is below Reg T

this cannot be implemented since maintenance requirements are only 25% of equity for long positions

this is permissible

this action must be approved by the FRB and FINRA

Answer

Explanation

this is permissible. Firms may establish house rules as long as they are at least as strict as the minimum maintenance requirements. Reg T only dictates an initial requirement and does not address minimum equity.

Questions # 116:

Which of the following is not classified as a money market instrument?

Options:

banker’s acceptances

commercial paper

American Depository Receipts

treasury bills

Answer

Explanation

American Depository Receipts. American Depository Receipts are used to facilitate transfer of ownership in foreign securities. They are not money market instruments.

Questions # 117:

Which of the following pairs of corporation characteristics are easiest for a partnership to avoid?

Options:

business objective and centralized management

continuity of life of the business and limited liability

two or more associates and free transferability of assets

continuity of life of the business and transferability of assets

Answer

Explanation

continuity of life of the business and transferability of assets. Partnerships may seek to avoid continuance of the business life and asset transfer. The other choices are too important for partnerships to sacrifice.

Questions # 118:

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

Bubba wants to buy 100 shares of DUM at $30 per share and 100 shares of OUT at $120. How much how much value of additional securities must Bubba deposit in lieu of depositing cash?

Options:

$3,000

$6,000

$9,000

$15,000

Answer

Explanation

$9,000. Since the required cash to deposit is $4,500 and Reg T is 50%, Bubba may deposit $9,000 of securities.

Questions # 119:

Bubba buys a bond issued at par with a 5% coupon that is convertible into common stock at $40.

What conversion ratio does Bubba determine?

Options:

Answer

Explanation

25. The conversion ratio is how many shares of common stock Bubba obtains by converting. Divide the bond price - $1,000 for a single bond - by the $40 conversion price.

Questions # 120:

To qualify as an intrastate offering under SEC Rule 147, which of the following is true of the issue?

Options:

it must be approved by the SEC

it must be sold only to bona fide residents of one state

it cannot exceed $1,500,000 in value

it must consist of common stock only

Answer

Explanation

it must be sold only to bona fide residents of one state. Under Rule 147 intrastate offerings are sold only to residents of one state and cannot be sold outside that state for nine months. All the other choices are incorrect about the rule.

Viewing page 12 out of 12 pages

Viewing questions 111-120 out of questions