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FINRA Series 7 Exam 182 Questions with Verified Answers,100% CORRECT
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FINRA Series 7 Exam 182 Questions with Verified Answers
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FINRA Series 7 Exam 182 Questions with Verified AnswersAn investor tells his rr to purchase 50m EGG 11.7% debenture bonds. The order
goes through and the bonds are purchased for 113. A year before the bond
matures, it is valued at 103. What is this called? - CORRECT ANSWER Amortization
In oil and gas limited partnerships is the risk greater in developmental or
exploratory programs? - CORRECT ANSWER exploratory
What is the best way to measure the GNP? (gross national product) - CORRECT
ANSWER constant dollars
What is the broker's role in the term "broker/dealer"? - CORRECT ANSWER
executing trades for client accounts
What is the maximum federal tax rate for corporations on their dividends and
other income? - CORRECT ANSWER 35%
What is the maximum federal tax rate for individuals on their dividends and other
income? - CORRECT ANSWER 20%
What type of securities are exempt from registration under the Securities Act of
1933? - CORRECT ANSWER government agency issues
Suppose a put is assigned to the writer. Under federal guidlines, the premium
received by the writer of the put is treated in what manner? - CORRECT ANSWER
It is subtracted from the cost basis when the writer is assigned
How much income must a REIT generate from the real estate properties? -
CORRECT ANSWER 75%
How much must a REIT pass-through of its profits to investors? - CORRECT
ANSWER 90%
,A portfolio manager of a pension fund desires income but wants to protect the
porfolio. What option position would he make? - CORRECT ANSWER Write calls
against the market index for income and protection.
A rr should request an extension of time for an invest to pay for stock that he has
purchased by the: - CORRECT ANSWER Fifth business day
Self-employed people can contribute how much to thier Keogh? - CORRECT
ANSWER The lesser of 100% of their income or $51,000
Your customer thinks that the stock is aobut to hit the resistance level and break
through to the next level. She would like to take advantage of the situation. Whay
type of ORDER would you suggest she place? - CORRECT ANSWER Buy Stop order
When an investor buys a corporate bond, they have how many days to pay for it?
- CORRECT ANSWER 3 business days
What are the rating agencies for ST, LT and Muni Debt Securities? - CORRECT
ANSWER 1. S&P
2. Moody's
3. Fitch's
4. Best's
What does Best's Rating service rate? - CORRECT ANSWER they are the one rating
company that rates insurance companies instead of bonds
How are CDs issued? - CORRECT ANSWER in bearer form only
Where are CDs shown and for how long? - CORRECT ANSWER on Nasdaq with a
minimum duration of 14 days
How are CDs quoted? - CORRECT ANSWER in terms of yield
Who does not issue eurodollar deposits? - CORRECT ANSWER US government
, What kind of taxes is the interest of corporate bonds subject to? - CORRECT
ANSWER federal income tax and state income tax
If a zero-coupon bond is held for one year and sold above its original value, the
investor will have? - CORRECT ANSWER ordinary income and capital gain
If a zero-coupon bondholder hold it until maturity they will have no? - CORRECT
ANSWER no capital gain
What type of muni note does not get rated by MIG because they are backed by a
government bond? - CORRECT ANSWER CLNs
What does a bond indenture NOT include? - CORRECT ANSWER re-offering yields
What is required before a revenue bond can be issued? - CORRECT ANSWER
feasibility study and engineering report
What must a muni bond being issued obtain from a bond counsel? - CORRECT
ANSWER legal opinion
What 3 things does the bond counsel help do while making its opinion? -
CORRECT ANSWER 1. research laws to check into tax-exempt status requirements
2. assist in getting favorable legislation passed in locality
3. supplies information to the underwriters for official statement
What are the 3 major bond rating organizations? - CORRECT ANSWER 1.S&P
2. Moody's
3. Fitch Investor's Service
What does a broker's broker NEVER do? - CORRECT ANSWER never acts as a
market maker and never acts in a principal transaction
Who determines the tax-exempt status of interest on muni bonds throught the
tax code? - CORRECT ANSWER IRS
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