how to reset iphone 7 without sim card or knowing password

I don't think you can use the phone.

After a hard reset -

Firstly the phone won't set up without an active sim

Secondly find my phone is enabled by default, so even if you did have a sim you wouldn't get pass the first few steps of setting up the phone as it will ask for the password.

You could try account recovery to reset the password, but you would need to know the email address you used to originally set up the phone. And if two factor authentication is one, it will send a code to the mobile number.

If you forgot the passcode for your iPhone, iPad, or iPod touch, or your device is disabled - Apple Support

You can hard reset an iphone, but if "find my phone" is enabled then you need your receipt for the phone and log a case with Apple