Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Series 7 > Exam 11 Wrong Answers > Flashcards

Exam 11 Wrong Answers Flashcards

You may prefer our related Brainscape-certified flashcards:
Series 7 Top-off Exam flashcards
1
Q

Where can retail investors find information on municipal bond issuers?

A

EMMA

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Option orders are transmitted to the CBOE trading floor via

A

OSS

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Variable life policy premiums

A

Are paid in fixed amounts at specified intervals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Sandy holds 2 XYZ Dec 60 calls. XYZ split 3:2. After the split Sandy holds 2 XYZ Dec 40 calls. A week later, she sold her calls for $3. What is the total premium she received?

A

$900

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

When a firm effects trades for its own account, it is acting in principal capacity and is considered a(n)

A

Dealer

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

In the sale of a new issue of municipal securities, MRSB disclosure requirements specify that a customer must be provided with a copy of the

A

Preliminary official statement

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Long term equity appreciation participation securities or LEAPS have expirations as long as

A

39 months

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

All of the following are components of the leading economic indicators as published by the Department of Commerce except

A

Index of industrial production

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Which of the following is a wash sale?

A

Selling a put or buying a call within 30 days of sale of stock

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Long 1,000 shares at 20, short 1,000 shares at 10. What is the minimum maintenance on these positions?

A

$10,000

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Which of the following is true about a stabilizing bid?

A

It must be disclosed in the prospectus

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Compute combined equity in this account. Long market value is $80,000; short market value is $6,000; Debit is $54,000; Credit is $10,000 and SMA is $10,000.

A

$30,000

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

With a systematic withdrawal plan, from what source are the first payments made?

A

Dividends

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

When a variable annuity is sold with a level load, the sales charge is deducted from

A

Each deposit made into the annuity contract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

After the first annuity payment is calculated in a variable annuity, future payments are calculated

A

By multiplying the number of annuity units by the current redemption value of a unit

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

The Securities Exchange Act of 1934

A

Regulates exchanges and over the counter markets

17
Q

Which of the following trades freely on an exchange or OTC?

A

Master limited partnership

18
Q

An investor is interested in selling her shares of ABS Corp. which trades over the counter. The best bid price is $3.15 from the market maker Donaldson. The best ask price is $3.30 from the market maker Williamson Investments. The investor trades listed stocks on the NYSE through her broker/dealer, STAT Investments. She can sell her ABC Corp shares

A

By contacting her broker/dealer STAT Investments; she will get the bid price of $3.15

19
Q

A client wants to discuss the assignment of his short call option on XYZ. The market price is $1.00 out of the money but the market price has been increasing steadily. He asks when he is required to deliver the stock. Which of the following is the correct means of option assignment for his call?

A

The Options Clearing Corporation decides which broker/dealer will deliver the securities. Then the broker/dealer will assign one of their clients by random selection. The client might not be assigned.

20
Q

Which of the following best describes cash settlement?

A

The customer pays for the securities on trade date

21
Q

Which of the following best fits the definition of investment adviser?

A

Publisher of reports used to promote particular securities

22
Q

The highest price a buyer is willing to pay for a security is known as the

A

Bid price

23
Q

Minimum margin on municipal bonds is determined by the

A

FINRA

24
Q

A customer shorts one ABC Jan 65 call for a premium of 4 and holds one ABC 70 call for a premium of 1. What is the customer’s maximum potential loss?

A

$200

25
Q

A customer receives a red herring from his registered representative and has indicated interest in the offering. Which two of the following are true?2

A

The customer is not obligated to buy the stock

The broker/dealer is not allowed to accept a deposit to secure the customer’s indication of interest

26
Q

All of the following are true regarding indications of interest eclipsed by an underwriter of a new public offering during the 20 day cooling off period except 2

A

Indications cannot be canceled by the customer

Indications cannot be cancelled by the underwriting firm

27
Q

Which of the following best describes the cross over point in limited partnership programs?

A

Cash flow and tax benefits have declined to equality with taxable income

Series 7 (47 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions