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Series-7 FINRA Series 7 General Securities Representative Qualification Examination (GS) Free Practice Exam Questions (2025 Updated)

Prepare effectively for your FINRA Series-7 Series 7 General Securities Representative Qualification Examination (GS) certification with our extensive collection of free, high-quality practice questions. Each question is designed to mirror the actual exam format and objectives, complete with comprehensive answers and detailed explanations. Our materials are regularly updated for 2025, ensuring you have the most current resources to build confidence and succeed on your first attempt.

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Total 400 questions

Bubba is concerned about the liquidity of a possible municipal bond purchase. He is therefore probably most interested in the rating supplied by which of the following?

A.

the bond buyers

B.

Moody’s

C.

White’s

D.

Dow Jones

A market-maker has purchased a particular stock over a period of time for prices as high as $9 per share and as low as $3 per share. The average cost is approximately $6 per share. The current NASDAQ quote for the stock is 5 to 5.25. According to the FINRA Conduct Rules, the dealer’s offering price to the public should be based upon:

A.

the current market for the stock

B.

$3

C.

$9

D.

$6

Hypothecation usually refers to which of the following?

A.

forecasting the market based upon past performance

B.

pledging securities as collateral

C.

determining a reasonable offering price for a new issue

D.

none of the above

Which of the following has the greatest risk?

A.

a guaranteed corporate bond

B.

a GNMA bond

C.

a Series H bond

D.

a treasury bill

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 NYSE minimum equity maintenance for this account?

A.

$5,500

B.

$6,000

C.

$6,600

D.

$12,600

Municipal bonds would be least attractive as an investment for which of the following?

A.

an insurance company

B.

a pension fund

C.

a commercial bank

D.

the executive officer of an industrial corporation in the highest income tax bracket

What is the maximum amount of gift to customers or other individuals related to the securities business that a registered representative is permitted to give?

A.

$500

B.

$200

C.

$100

D.

$50

Under what conditions may an FINRA member firm sell an IPO to an employee of another broker/dealer?

A.

if the amount of the purchase is small and the transaction accords with the employee’s normal investment practice

B.

if the member firm notifies the other broker/dealer of the transaction

C.

if the employing broker/dealer guarantees that resale of the securities acquired by its employee will be restricted for two years

D.

under no circumstances

The return by the receiving party of securities previously accepted for delivery or a demand by the delivering party for return of securities that have been delivered is called:

A.

rejection

B.

close-out

C.

reclamation

D.

re-delivery

In regard to discretionary accounts, which of the following statements is correct?

A.

the customer must approve each transaction in writing before the order is entered

B.

the customer must grant written authorization to the member firm to exercise discretion in the account

C.

the account must be accepted in writing by an officer of the member firm

D.

both B and C

A company earns $6 per share and pays out 20% in common stock dividends.

What does the stock yield if it sells at $30 per share?

A.

10%

B.

4%

C.

2.5%

D.

6%

Bubba wants to buy a US treasury bond with a bid of 97.28 and an asking of 98.2.

How were these prices established?

A.

by the FINRA

B.

by the Federal Reserve Board

C.

by competitive biding

D.

by the terms of the bond

Bubba buys a 5% municipal bond maturing in 15 years that is trading at a market price of 85 . What is the nominal yield?

A.

5.88%

B.

5.1%

C.

5.00%

D.

cannot be determined

Which of the following may occasionally be purchased at a discount from net assets value?

A.

no-load funds

B.

closed-end funds

C.

open-end funds

D.

contractual plans

If a municipality has funds available to make a partial call of an issue of outstanding serial bonds, which bonds should be called first?

A.

the shortest maturity

B.

the maturity with the largest number of bonds

C.

the longest maturity

D.

the maturity bearing the lowest interest rate

Securities may be sold under SEC rule 144 provided that the following conditions are met:

A.

the company files regular financial data with the SEC

B.

they are sold in agency transactions only

C.

they are sold in principal transactions only

D.

both A and B

Which of the following is not an intangible drilling cost?

A.

salaries

B.

supplies and fuel

C.

machinery and pipe

D.

repairs

Assuming all of the following bonds from the same issuer are callable now, which one would most likely get called first?

A.

8% maturing 1-15-2016

B.

8% maturing 1-15-2007

C.

4% maturing 1-15-2012

D.

4% maturing 1-15-2007

What percentage of maintenance charges and debt service are covered by the rate covenant of a revenue bond issued to finance a municipal toll road?

A.

75%

B.

100%

C.

120%

D.

150%

Maintaining a fair and orderly market and acting as a broker’s broker are dual functions of the:

A.

competitive trader

B.

odd-lot dealer

C.

specialist

D.

two-dollar broker

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Total 400 questions
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