Practice Quiz

FINRA Series 7

Category - Series 7

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An investment company acting as a conduit in the distribution of net investment income, pursuant to IRS rules, is called:
  1. balanced
  2. diversified
  3. regulated
  4. dual-purpose
Explanation
Answer: C - regulated. The term “regulated” refers to tax status under Subchapter M of the Internal Revenue Code. This simply means that if a mutual fund or other investment company qualifies for regulated status, the threat of taxation at multiple levels is eliminated.
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