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Finra Series-7 Exam - Topic 5 Question 32 Discussion

If a customer fails to pay for securities purchased in a cash account, the member firm broker will do which of the following?
D) liquidate the securities or otherwise cancel the transaction
A) grant an extension for a bona fide reason
B) place the securities temporarily in a general account
C) purchase the securities for the firm's error account

Finra Series-7 Exam - Topic 5 Question 32 Discussion

Actual exam question for Finra's Series-7 exam
Question #: 32
Topic #: 5
[All Series-7 Questions]

If a customer fails to pay for securities purchased in a cash account, the member firm broker will do which of the following?

Show Suggested Answer Hide Answer
Suggested Answer: D

liquidate the securities or otherwise cancel the transaction. Reg T requires the position closed if the customer fails to comply with the rules. An extension may be granted, but not by the member firm. Only an exchange or the FINRA grants extensions for bona fide reasons.


by Fausto at May 04, 2022, 05:54 AM

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Lili
10 months ago
B is misleading, they don’t just place it in a general account.
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Tyisha
10 months ago
Wait, can they really just cancel the whole transaction?
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Nancey
11 months ago
Definitely D, no doubt about it!
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Kenneth
11 months ago
I thought they could grant extensions sometimes?
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Nydia
11 months ago
D is the correct answer, they usually liquidate.
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Sharika
11 months ago
I recall that the firm usually has to protect itself, so I’m leaning towards option D, but I hope I’m not mixing it up with another scenario.
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Elvis
11 months ago
I’m a bit confused about the options. I thought they could grant an extension, but that seems risky for the firm.
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Alysa
11 months ago
I feel like I've seen a question like this before, and I think the answer was about liquidating the securities.
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Yvonne
11 months ago
I think I remember that if a customer doesn't pay, the broker has to take action, but I'm not sure if it's to liquidate or cancel the transaction.
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An
11 months ago
This looks like a straightforward question about logging in an AWS Lambda function. I think the key is to identify where the request ID is available and how to configure the logging output.
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Launa
11 months ago
I'm leaning towards option A, but I'm second-guessing whether an increase in YTM necessarily leads to a lower bond price...
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