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The National Merit Qualifying Exam is the PSAT. It is supposed to be taken junior year - the year BEFORE a student finishes high school. The National Merit scholarships are not large- just a couple grand, I think, but they are prestigious. Colleges like to have bragging rights about how many NM semi-finalists or finalists they have. Some people chose to avoid early high school graduation in order to pursue the NM awards. Is this the conflict you are talking about?
Cym-
I think early test taking is good for practice and also to get a feel for how they may do later. My oldest took the SAT at 13 and was recognized at the state level for his scores. We anticipated that he'd get near perfect scores four years later, but he barely went up at all in math, though his verbal scores were almost perfect. He just wasn't a mathy kid and he didn't put much effort into it.
My 11 yo has taken a couple practice tests at home for the SAT and ACT, and he has scored well on these but has yet to take a test for real. He will be taking the ACT soon and the SAT next year.
I'm not a big fan of test prep, but I do think it is good for the student to be familiar with the format. It's also nice for the kids to actually go through the test process when the stakes are not so high.