Series 7 Exam Question 349: Answer and Explanation

Question: 349

Mr. Smith has an inactive account with stocks and bonds at a broker-dealer. How often is the firm required to send Mr. Smith an account statement?

• A. Once a month
• B. Once a week
• C. Once every three months
• D. Once every six months

Correct Answer: C

Explanation:

C. The broker-dealer must send out account statements at least once every three months (quarterly) for an inactive account. If there has been any activity during a particular month, the brokerage firm must send out an account statement that month. Mutual funds must send out account statements once every six months (semiannually).