Finra Series-7 Exam Practice Test Instant Access

Question 1

A treasury obligation having no fixed rate of interest with a thirty-day maturity due April 22 is most likely a:

Atreasury note

Btax anticipation bill

CSeries H bond

DSeries EE bond

Answer : B

tax anticipation bill. These obligations pay no interest and their maturity comes after corporate tax payment dates. They are accepted for redemption at face value prior to maturity on corporate tax payment dates to encourage purchase by corporations.

Question 2

Bubba has a short margin account with a short market value of $22,000, a credit balance of $42,000, and SMA of $500.

What is the equity in Bubba's account?

A$500

B$20,000

C$20,500

D$37,000

Answer : B

$20,000. The equity in a short margin account is equal to the credit balance minus the short market value. SMA is not considered when computing equity.

Question 3

A corporate bond is quoted as having a net change in value of plus one point.

By how much did the bond price increase?

A$1,000

B$100

C$10

D$1

Answer : C

$10. A point is 1% and bonds are priced in $1,000 increments. Multiplying $1,000 by 1% equals $10.

Question 4

The general purpose of the Securities Act of 1933 is to:

Aregulate the activities of investment advisers

Bregulate the sale of securities on national exchanges

Cprovide for disclosure of information about new securities offerings

Dprovide for disclosure of the financial condition of underwriters

Answer : C

provide for disclosure of information about new securities offerings. The 1933 act is primarily concerned with registration and disclosures relating to new securities.

Question 5

Which of the following stock exchanges is not registered with the SEC?

APacific Stock Exchange

BBoston Stock Exchange

CChicago Stock Exchange

Dall are registered

Answer : D

all are registered. All are registered with the SEC.

Question 6

Bubba is opening a margin account with a member organization. He wishes to purchase 100 shares of XYZ at $15 per share.

What is Bubba's initial cash deposit?

A$375

B$1,050

C$1,500

D$2,000

Answer : C

$1,500. The NYSE minimum requirement is the lower of $2,000 or 100% of the account.

Question 7

Bubba Securities, Inc. offers 3,000,000 shares of Top Notch Manufacturing Corporation common stock at $27 per share. The next day an advertisement appears in the Wall Street Journal announcing the offering and listing the names of some of the underwriting firms.

This ad is commonly referred to as a:

Apublic offering

Btombstone ad

Csales directive

Dsyndicate announcement

Answer : B

tombstone ad. Tombstone ads are used to announce new issues. They do not offer to buy or sell securities. They are informational only.

Finra General Securities Representative Examination (GS) Series-7 Exam Practice Test