Ch 12 quiz

Compared to a full-service broker. A discount broker

Charges much lower fees and commissions

Along with revenue, which of the following figures indicates the size of a company

Market cap

A stockbroker does NOT typically charge a fee for giving investment advice or for making a sale or purchase transaction for an investor.

False

As a result of the Wall Street Reform Act, lenders are now required to grant loans based on stated income

False

Brokerage firms usually charge higher per share fees for trading in round lots

False

New issues of securities are offered through securities exchange

False

The primary goal of the SEC is to promote public confidence in the bank system

False

Before the commodity future trading commission was created, most future trading took place in the agricultural sector

True

Direct investing is less expensive than buying socks at securities exchange because there are no brokerage fees involved

True

Most brokerage accounts requiere a minimum deposit or a regular monthly deposit amoun

True

Selling short involves using leverage

True

The Securities and Exchange Commission (SEC) requieres all corporations that sell mutual funds to the public to provide potential buyers with a prospectus

True

The wall street reform act passed in 2010 as a response to the financial crisis of 2007-2009

True

Which of the following investing techniques involves making a selection of securities and preparing a competitive analysis periodically

Watch and wait

Receiving two shares of stock for each share you currently own is called a

Stock spilt

Which of the following types of stock market transactions protects you from a sudden drop in price?

Stop order

The Federal Deposit Insurance Corporation (FDIC) insures depositor accounts up to

$250,000

All the following are duties of the U.S Department of the Treasure execpt

Setting monetary policy

The first step in buying securities is to

Set up an account