Series 7 exam 2025 Questions and
Answers
A new stock issue may begin trading on NASDAQ - ANSWER✔✔-following the
opening trade on the morning of the effective date
Place the following in their proper order in the handling of an order. - ANSWER✔✔-
Wire room, purchase and sale, margin and cashier (wet pups surf in Malibu)
A restricted margin account is one in which - ANSWER✔✔-The equity is less than reg-T
(50%)
Underwriting compensation in IPOs is subject to a thorough review by FINRA. Finra
will make a definitive ruling on the fairness and reasonability of each of the following
issue attributes with the exception of: - ANSWER✔✔-The POP of new shares
As the result of a client complaint involving accusations of churning, and allegations of
unauthorized trades, a duly qualified panel of arbitrators has heard the case and
rendered its ruling against the registered rep on all counts, as well as the branch
manager and the member firm for failure to supervise. FINRA rules set forth the normal
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,procedure for the filing of an appeal to the adverse ruling with which of the following?
- ANSWER✔✔-Arbitrate ruling can not be appealed
The most volatile of the money market rates shown below is the: - ANSWER✔✔-Fed
Funds Rate
One of your customers who is an active trader and is a student of technical analysis has
called you to discuss his findings regarding the price action on MMM common. He
believes that it is fast approaching its resistance level of 60. If he does not think the stock
will break out, which of the below would be most appropriate? - ANSWER✔✔-Sell
most or all current long positions
The stock of which of the following listed corporations is generally considered the most
sensitive to interest rate changes? - ANSWER✔✔-Public Utility
Which of the following mutual funds would be most suitable for the client seeking
stability of capital? - ANSWER✔✔-Balance fund is the definition of stability of capital
An investment in United States Treasury bonds may be subject to which of the
following taxes? - ANSWER✔✔-Capital gain and Federal Income tax
Direct institution to institution securities transactions are considered - ANSWER✔✔-4th
market
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, The Daily Bond Buyer publishes information about the municipal securities business
including the volume of new municipal issues coming to market over the next 30 days.
This is referred to as: - ANSWER✔✔-The visible supply
Uncovered short put exercise results in - ANSWER✔✔-acquisition of shares with a
resulting cost basis of strike price less premium
A Eurodollar bond has each of the following characteristics except: - ANSWER✔✔-
interest payments may be made in either US dollars or the currency of the nation in
which the bond was issued. (can only be paid in US dollars)
Compute the taxable or corporate equivalent yield for a 4.5% GO in the portfolio of an
investor in the 36% tax bracket. - ANSWER✔✔-Municipal yield divided by (100%
minus investor's tax bracket)= 4.5% divided by (100% minus 36%)= 4.5% divided by
64%= 7.03%
The breadth of the market is measured by the - ANSWER✔✔-Advance/decline ratio
(advancing stocks and declining stocks)
A margin account customer buys 100 shares of JKS common at 80 and deposits the
required Reg. T margin. A week later with JKS at 90, the account has SMA of: -
ANSWER✔✔-The initial purchase of $8,000 at 50% Reg. T requires a down payment of
$4,000 and creates a loan from the broker to the client of $4,000, referred to as the
customer's debit balance. With the stock rising to 90, the CMV is now $9,000 while the
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
Answers
A new stock issue may begin trading on NASDAQ - ANSWER✔✔-following the
opening trade on the morning of the effective date
Place the following in their proper order in the handling of an order. - ANSWER✔✔-
Wire room, purchase and sale, margin and cashier (wet pups surf in Malibu)
A restricted margin account is one in which - ANSWER✔✔-The equity is less than reg-T
(50%)
Underwriting compensation in IPOs is subject to a thorough review by FINRA. Finra
will make a definitive ruling on the fairness and reasonability of each of the following
issue attributes with the exception of: - ANSWER✔✔-The POP of new shares
As the result of a client complaint involving accusations of churning, and allegations of
unauthorized trades, a duly qualified panel of arbitrators has heard the case and
rendered its ruling against the registered rep on all counts, as well as the branch
manager and the member firm for failure to supervise. FINRA rules set forth the normal
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,procedure for the filing of an appeal to the adverse ruling with which of the following?
- ANSWER✔✔-Arbitrate ruling can not be appealed
The most volatile of the money market rates shown below is the: - ANSWER✔✔-Fed
Funds Rate
One of your customers who is an active trader and is a student of technical analysis has
called you to discuss his findings regarding the price action on MMM common. He
believes that it is fast approaching its resistance level of 60. If he does not think the stock
will break out, which of the below would be most appropriate? - ANSWER✔✔-Sell
most or all current long positions
The stock of which of the following listed corporations is generally considered the most
sensitive to interest rate changes? - ANSWER✔✔-Public Utility
Which of the following mutual funds would be most suitable for the client seeking
stability of capital? - ANSWER✔✔-Balance fund is the definition of stability of capital
An investment in United States Treasury bonds may be subject to which of the
following taxes? - ANSWER✔✔-Capital gain and Federal Income tax
Direct institution to institution securities transactions are considered - ANSWER✔✔-4th
market
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 2
, The Daily Bond Buyer publishes information about the municipal securities business
including the volume of new municipal issues coming to market over the next 30 days.
This is referred to as: - ANSWER✔✔-The visible supply
Uncovered short put exercise results in - ANSWER✔✔-acquisition of shares with a
resulting cost basis of strike price less premium
A Eurodollar bond has each of the following characteristics except: - ANSWER✔✔-
interest payments may be made in either US dollars or the currency of the nation in
which the bond was issued. (can only be paid in US dollars)
Compute the taxable or corporate equivalent yield for a 4.5% GO in the portfolio of an
investor in the 36% tax bracket. - ANSWER✔✔-Municipal yield divided by (100%
minus investor's tax bracket)= 4.5% divided by (100% minus 36%)= 4.5% divided by
64%= 7.03%
The breadth of the market is measured by the - ANSWER✔✔-Advance/decline ratio
(advancing stocks and declining stocks)
A margin account customer buys 100 shares of JKS common at 80 and deposits the
required Reg. T margin. A week later with JKS at 90, the account has SMA of: -
ANSWER✔✔-The initial purchase of $8,000 at 50% Reg. T requires a down payment of
$4,000 and creates a loan from the broker to the client of $4,000, referred to as the
customer's debit balance. With the stock rising to 90, the CMV is now $9,000 while the
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
