FINRA Series 7 – General Securities Representative — Question 3

A front-end loan mutual fund plan is most suitable for:

Answer options

• A. a voluntary accumulation plan
• B. a contractual plan
• C. an automatic withdrawal plan
• D. an optional withdrawal plan

Correct answer: B

Explanation

A front-end load mutual fund is designed to charge a fee upon investment, making it most appropriate for a contractual plan where investors agree to specific terms and commitments. The other options, such as voluntary accumulation and withdrawal plans, do not align with the fee structure and commitment required by front-end load funds.