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  1. Home
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  3. SERIES 7

FINRA SERIES 7 Exam (page: 2)
FINRA General Securities Representative ination (GS)
Updated on: 25-Dec-2025

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SERIES 7 PDF 400 Questions

Bubba owns stock with cumulative voting rights. There are five vacancies on a board and he owns 100 shares of stock. Bubba is entitled to cast the following votes:

  1. a total of 100 votes
  2. a total of 100 votes per
  3. a total of 500 votes
  4. you are not allowed to vote

Answer(s): C

Explanation:

500 votes. Under cumulative voting, the number of directors is multiplied by the number of shares owned. The votes may be cast all for a single director or divided in any manner among the directors.



The definition of debentures is:

  1. a loan secured by real estate
  2. collateralized securities
  3. a worthless security
  4. securities backed by the general credit of the issuers but no specific collateral

Answer(s): D

Explanation:

securities backed by the general credit of the issuers but no specific collateral. And in the case of some issuers, that may be fairly worthless.



Convertible bonds have all of the following features except:

  1. an ability to protect a short position on the stock into which they are convertible
  2. permissibility for use as collateral
  3. a normally higher yield than non-convertible bonds of the same issuer
  4. fluctuations influenced by changes in the price of the underlying common stock

Answer(s): C

Explanation:

a normally higher yield than non-convertible bonds of the same issuer. Remember that the QUESTION: says “except” for this feature. Convertible bonds normally do NOT have a higher yield than non- convertible bonds of the same issuer. Convertibles usually have a lower yield than non -convertible sisters.



Although a corporation has no earnings in a particular year, it is obligated to pay interest on all its outstanding debt except the following:

  1. convertible subordinated debentures
  2. collateral trust bonds
  3. adjustment bonds
  4. equipment trust certificates

Answer(s): C

Explanation:

adjustment bonds. These bonds are also known as income bonds. Interest is paid only if there is income.



Interest rates rise from 5.10% to 5.30%. For a prospective buyer of five $1,000 bonds, what is the increase in interest payments as a result of the rise?

  1. $20
  2. $100
  3. $2
  4. $10

Answer(s): D

Explanation:

$10. Interest rates increased by 20 basis points. One basis point is 10 cents. So 20 basis points is $2. But…since there are five bonds, that $2 x 5 = $10.



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Share your comments for FINRA SERIES 7 exam with other users:

Karan Patel 8/15/2023 12:51:00 AM

yes, can you please upload the exam?
UNITED STATES