FIN 9781 MARGIN ACCOUNTS Economics SERIES 7 EXAM QUESTIONS AND ANSWERS A.

FIN 9781 MARGIN ACCOUNTS (Economics) SERIES 7 EXAM QUESTIONS AND ANSWERS A.
Securities can be gifted to charity and deducted at, if
Answer -their fair market value, as long as they have been held
more than 1 year. The fair market value of the deduction allowed for 200
shares is 200 multiplied by the current market price of the stock, or
$18,000.
Original issue discounts are
Answer -accreted, which allows for a step-up in cost basis.
Accretion on original issue discount municipal bonds is not taxed.
The scale, or reoffering scale, represents the
Answer -prices and/or yields at which new issue securities are
offered for sale to the public by the underwriter. The syndicate uses this
scale to determine its bid on the issue.
Call options are in-the-money whenever the
Answer -market price of the stock is greater than the strike price.
If a withdrawal from a Roth IRA is a qualified distribution, the withdrawal
is
Answer -tax free, A qualified distribution is made after a 5-year
holding period and after the taxpayer has reached age 59½.