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Municipal Securities Analysis & Regulations Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

Page 1

Question 1 1. With a general obligation municipal bond, one of the factors to look at when considering marketability is:

Question 2 2. With a general obligation municipal bond offering, one of the factors to consider in assessing a public entity's ability to handle the debt is:

Question 3 3. When assessing a general obligation municipal bond offering, overlapping debt must be considered because _____

Question 4 4. Sherri has purchased a municipal bond issued from the state of California where she currently lives and works. Sherri receives annual interest payments from the bond in the form of coupon payments. What sort of special tax status does Sherri enjoy in regard to the coupon payments?

Question 5 5. Taj lives and works in Florida and has purchased a municipal bond issued from the state of New York. Taj receives annual interest payments from the bond in the form of coupon payments to him. What sort of special tax status does Taj enjoy in regard to the coupon payments?

Page 2

Question 6 6. Scott has purchased a bond from another investor. The original par value for the bond was $1000 but Scott purchased it on the market for $1010. Scott purchased this bond at a what?

Question 7 7. Investments in Plan 529 refers to:

Question 8 8. One of the requirements to be a 'sophisticated municipal market professional' is:

Question 9 9. Under Rule D-15, the municipal fund security must first be categorized as:

Question 10 10. Rule G-13 of the MSRB provides some flexibility in quotes by allowing some adjustments. Which one of these adjustments is NOT allowed?

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Question 11 11. Which rule defines municipal securities?

Question 12 12. The commissions charged by dealers, agents or brokers are within the purview of the sales charge as per _____.

Question 13 13. In analyzing a municipal revenue bond, all of these factors are considered on the funded project EXCEPT:

Question 14 14. A public project financed by a revenue bond has revenues of $20 million, operating expense of $13.5 million and debt service expense of $3 million. What is the debt service coverage ratio?

Question 15 15. A municipal revenue bond is issued by a governmental body to be repaid from:

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Question 16 16. A bond is priced at $4,782.50 and matures in 10 years. What is the annual accretion of discount if the par value if $5,000?

Question 17 17. The coupon price of the bond is:

Question 18 18. Municipal bond quotes are usually quoted for a par value of _____.

Question 19 19. The types of municipal bonds relying on taxation power to fund bond obligations are known as:

Question 20 20. Which of these is the best geographical diversification method?

Page 5

Question 21 21. The ratings-based classification differentiates the bonds on the basis of:

Question 22 22. The steps for calculating accrued interest on a municipal bond in proper order are:

Question 23 23. Accrued interest on a security with an odd first payment that has a contractual rate of 5%, semi-annual interest payments, purchased 18 days after security issued, and a face value of $5,000 is:

Question 24 24. Amortization of excess premiums is:

Question 25 25. The return earned when the bond is held until the date of par value payment is _____.

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Question 26 26. The return on taxable bonds that equals the return on municipal bonds is _____.

Question 27 27. Assume a bond is purchased today at $1,100 with annual coupons of $55. What is the current yield?

Question 28 28. General obligation municipal bonds are called general obligation because _____

Question 29 29. If Tamara were to buy a municipal bond issued by her state for $1000 and that bond had a 3% interest rate yield, she would receive a $30 coupon payment each year. Normally Tamara would have to pay 25% between federal and state taxes on the coupon. What is the taxable equivalent yield of Tamara's bond?

Question 30 30. Rule D-12 was added by the:

Municipal Securities Analysis & Regulations Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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