Series 7 Exam Practice Test 23

1. Which of the following securities is/are directly backed by the U.S. government?




2. Which of the following disputes must be resolved using the Code of Arbitration?

I. A dispute between a member of FINRA and a registered rep

II. A dispute between a member of FINRA and a customer

III. A dispute between two members of FINRA

IV. A dispute between a bank and a member of FINRA

3. Duke Wallwalker purchased an LTSBR Corporation convertible bond at 95 on January 20, 2018. The bond is convertible at $40, and the investor converts his bond into stock on January 21, 2021. If the bond is trading at 104 and the common stock is trading at $42, for tax purposes, these transactions will result in

4. XYZ is currently trading at 24.10–24.25. A designated market maker in XYZ could enter a bid at which of the following prices?

5. RANs, BANs, TANs, and CLNs are issued by municipalities seeking

6. If an official statement has a dated date of May 1st, but the first coupon payment is set at December 1st, it means that the first payment is a

7. Which of the following statements regarding municipal revenue bonds is NOT true?

8. One of your customers feels they were overcharged for a trade and sends your firm a written complaint. What must happen with regard to the complaint?

9. All of the following may be sources of revenue for a revenue bond EXCEPT

10. One of your clients would like to add some municipal bonds to their portfolio. Since your client has enough cash to diversify, you should let them know that some of the ways they could diversify would be

I. geographically

II. par value of certificates

III. type of bonds

IV. ratings

11. Mark Schwimmerr owns 2,500 shares of TP Corporation. Which of the following actions would dilute Mark's equity?

I. Primary share offerings (registered)

II. A stock split

III. Payment of a stock offering

IV. Secondary share offerings (registered)

12. What is the minimum maintenance for pattern day trading accounts?

13. All of the following are examined by a fundamental analyst EXCEPT

14. The Trade Reporting and Compliance Engine (TRACE) promotes better market transparency by allowing trade details to be released to the investing public that purchases

15. Mike Smith is one of your clients. Mike is 55 years old, has a wife, two young adults going to college, and two children living at home. You have helped Mike determine his investment profile and how much risk he should be willing to take. However, Mike is hot on a particularly speculative security that doesn't fit his investment profile. Mike calls you saying he wants to purchase $20,000 worth of this security. What should you do?

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