unit 1 quiz reviews series 65

Currency transaction reports must be filed for cash transactions that exceed: A)$10,000.00 B)$50,000.00 C)$100,000.00 D)$25,000.00

$10,000

what is the minimum assets a open end investment company must have for a offering?

$100,000

which of the following would be considered when determining whether excessive trading has occurred in a clients account? 1. The number of years the account has been operated 2.the performance of the account in comparison to other clients accounts 3.the size of companies issuing securities 4.the nature of the clients financial objectives

4. The nature of the clients financial objectives

The provisions of the Securities Act of 1933 include all of the following EXCEPT: A)regulation of the secondary market. B)regulation of offerings of new securities. C)prohibition of fraud in the sale of new securities. D)requirement that an issuer provide full and fair disclosure about an offering.

A)regulation of the secondary market.

To enforce the Securities Act of 1933, the SEC may: 1.conduct formal investigations. 2.issue cease and desist orders. 3.refer evidence to the attorney general for possible criminal prosecution.

all of the above 1 2 and 3

when an agent is discussing possible discounts related to the purchase of mutual funds shares, she would be referring to?

breakpoints

Rule 482 of the Securities Act of 1933 permits the use of an omitting prospectus if it does not: A)contain an application to purchase shares of the fund. B)make reference to the mutual fund's past performance. C)describe how and where to obtain the fund's prospectus. D)omit a statement of the fund's expense ratio.

contain an application to purchase shares of the fund.

An intrastate offering is exempt from: A)federal registration. B)blue-sky registration. C)state registration. D)all registrations.

federal registration

Seven years ago, Ivan was found guilty of embezzling securities from clients. He now wishes to join another brokerage firm. Which of the following statements is TRUE regarding this situation? A)He cannot be employed because he is still subject to statutory disqualification provisions. B)He may be employed in a sales position, provided the firm agrees to be liable for any losses due to his misconduct. C)There are no provisions restricting his employment because the restriction time period has elapsed. D)He may be employed by a brokerage firm, provided he is not involved directly in any dealings with clients.

he cannot be employed because he is still subject to statutory disqualification provisions

can a closed in investment company redeem its own shares?

no

The Securities Act of 1933 regulates: A)offerings of new securities. B)self-regulatory organizations (SROs). C)investment advisory firms. D)broker-dealers and associate members.

offerings of new securities

Rule 482 describes a form of allowable mutual fund advertising, commonly referred to as an

omitting prospectus

Rule 482 of the Securities Act of 1933 deals with: A)omitting prospectuses. B)intrastate offerings. C)registration under coordination. D)private placements.

omitting prospectuses

When a new issue of common stock is in registration, registered representatives are permitted to: A)furnish prospects with a final prospectus. B)send a copy of the preliminary prospectus. C)accept tentative orders. D)receive indications of interest along with a good faith deposit.

send a copy of the preliminary prospectus

Under the Securities Act of 1933, securities issued by charitable organizations are exempt if: A)the organization is a nonprofit company. B)the net earnings from the organization are paid to less than 10 private stockholders. C)the organization is funded by government grants. D)no commissions are paid on the distribution of shares.

the organization is a non profit company

discretion authorizes a representative to choose: ( 3 things)

the security, the amount of shares, weather to buy or sell.

under the securities act of 1934 what two exclusions are their with regards to being considered a prospectus?

tombstone advertisements(announcements) and oral offers

Government securities, money-market instruments (the promissory note is another way of saying commercial paper), and intrastate offerings are exempt from the registration provisions of the 1933 Act. A stock being offered in three states would have to register with the SEC and possibly with those states. (true or false)

true

The principal executives of the company involved with money and a majority of the board of directors are required to sign the registration statement attesting to the facts presented as being true to the best of their knowledge and belief. This includes the chief executive officer, chief financial officer, and a majority of the board, but not the chief operating officer. (true or false)

true

Which of the following are regulated under the Securities Exchange Act of 1934? 1.Broker-dealers. 2.Investment advisers. 3.Pension plans. 4.Transfer agents.

1. Broker-dealers and 4. transfer agents

the requirement for reports of beneficial ownership is that anyone who becomes the owner of more than 5% of a security registered under the securities Exchange Act of 1934 must file a report within ____ days

10

Margin regulations are determined by the Board of Governors of the Federal Reserve System. The authority for them to do so is found in the: A)Securities Exchange Act of 1934. B)Federal Reserve Act of 1913. C)Securities Act of 1933. D)Maloney Act of 1938.

Securities Exchange Act of 1934.

Under the Securities Exchange Act of 1934, commissioners of the SEC: 1.are appointed by a joint House/Senate panel. 2.are appointed by the President. 3.may not engage in any other business.

are appointed by the president and may not engage in any other business

Securities sold under Regulation D of the Securities Act of 1933 are private placements and, under the NSMIA, are considered ___________ covered securities.

federal

_______ involves entering buy orders for the purpose of supporting a stock price (i.e., to keep it from falling)

pegging

investment companies must send financial reports to shareholders?

semiannually;

An issue in registration has not yet become effective. A preliminary prospectus may be sent and indications of interest may be accepted, but no orders or money are accepted until the effective date. (true or false)

true

The Securities Exchange Act of 1934 regulates broker-dealers and transfer agents. Investment advisers are regulated under the Investment Advisers Act of 1940 (and, to a certain extent, the Investment Company Act of 1940), whereas pension plans in the private sector are regulated under ERISA. (true or false)

true

Under the Securities Act of 1933, a security is any note, stock, bond, certificate of interest, or participation in any profit sharing arrangement, investment contract, certificate of deposit for a security, fractional undivided interest in oil, gas, or mining rights, or any investment commonly considered a security. The definition does not include direct ownership of real estate, commodities futures contracts (e.g., corn, wheat), collectibles, or precious metals.(true or false)

true

which of the following are discretionary orders?(multiple answers) 1. A customer sends a check for $25,000 to an agent and instructs the agent to purchase bank and insurance company stocks when the price appears favorable 2.A customer instructs an agent to buy 1,000 shares of ABC corporation at a time or price determined by the agent 3.A customer instructs an agent to purchase as many shares of XYZ as the agent considers appropriate 4.A customer instructs an agent to sell 300 shares of LMN, inc , when the agent deems the price is appropriate

1. A customer sends a check for $25,000 to an agent and instructs the agent to purchase bank and insurance company stocks when the price appears favorable 3. a customer instructs an agent to purchase as many shares of XYZ as the agent considers appropriate

all of the following would qualify as investment companies EXCEPT (multiple answers) 1.face amount certificate companies 2.unit investment trust 3.closed end investment companies 4. open end investment companies

1. Face amount certificate companies 2. unit investment trust

Under the Securities Act of 1933, the sale of stock of a state bank is exempt from which of the following? 1.Prospectus requirements. 2.Antifraud provisions . 3.Registration requirements.

1. prospectus requirements and 3.registration requirments

The SEC was created by the Securities Exchange Act of ____

1934

under the securities act of 1934 which of the following would be considered a prospectus? 1. Tombstone advertisement 2. Television advertisement 3.offer communicated over the phone

2. television advertisement

Which of the following securities is NOT exempt from the registration provisions of the Securities Act of 1933? A)A new stock being offered in three states. B)An equity security issued in only one state solely to residents of that state. C)A high-quality corporate promissory note maturing in 180 days. D)A U.S. government bond.

A new stock being offered in three states

When a new issue of common stock is in registration, registered representatives are permitted to: A)accept tentative orders. B)furnish prospects with a final prospectus. C)receive indications of interest along with a good faith deposit. D)send a copy of the preliminary prospectus.

Receive indications of interest along with a good faith deposit

The Securities Exchange Act of 1934 calls for the registration of many different entities involved in the securities business, such as exchanges and broker-dealers. The Act also requires registration of securities information processors such as

Securities Industry Automation Corporation (SIAC) and OPRA or options price reporting authority

Which of the following is responsible for administration of the Bank Secrecy Act? A)The Financial Crimes Enforcement Network. B)Securities and Exchange Commission. C)Security Services. D)Department of Health and Human Service.

The Financial Crimes Enforcement Network.

XYZ Corp. will issue a new security and distribute it through a public offering. Under the Securities Act of 1933, which of the following is NOT required to be included in XYZ's registration statement? A)An estimate of the proceeds that will be raised through the offering and how that money will be used. B)The name and address of Jan Michael, who owns 11% of XYZ's stock. C)The identity of the underwriter. D)The name and address of XYZ's personnel manager.

The name and address of XYZ's personnel manager.

Under the Securities Act of 1933, which of the following is NOT a security? A)Bond. B)Certificates of deposit for a security. C)Preferred stock. D)Commodities futures contracts.

commodities futures contracts

What law was enacted requiring transactions by officers, directors, and principal shareholders to be reported and ensuring equitable and fair practices in the secondary trading of securities? A)Securities Act of 1933. B)Investment Company Act of 1940. C)Securities Exchange Act of 1934. D)Securities Investor Protection Act of 1970.

securities exchange Act of 1934

which of the following acts require publicly traded corporations to issue annual reports?

securities exchange act of 1934

Currency transactions in excess of $10,000 are reported electronically on FinCEN Form 112 to the Department of the Treasury. (true or false)

true

The Securities Exchange Act of ____ created the SEC to regulate trading practices of exchanges, broker-dealers, issuing companies, and individuals who trade securities.

1934

An investment company offering securities registered under the Act of 1933 may make which of the following statements? 1."The SEC has passed on the merits of these securities as an investment.". 2."The SEC has released our securities for sale to the public.". 3."The SEC has passed on the accuracy of the information in our prospectus.". 4."The SEC has declared this prospectus effective.".

2."The SEC has released our securities for sale to the public.". 4."The SEC has declared this prospectus effective.".

Which of the following qualify for a discount in a mutual fund's sales charge under the Investment Company Act of 1940? 1.An investment club places an order for $10,000 worth of shares to be held in 3 names; the fund offers a volume discount for a single purchase of $10,000. 2.A vice president of a firm under contract to provide investment advice to a mutual fund buys $10,000 worth shares of the fund with a $10,000 breakpoint. 3.A married couple each purchases $5,000 worth of fund shares; the fund offers a volume discount for a single purchase of $10,000.

2.A vice president of a firm under contract to provide investment advice to a mutual fund buys $10,000 worth shares of the fund with a $10,000 breakpoint. and 3.A married couple each purchases $5,000 worth of fund shares; the fund offers a volume discount for a single purchase of $10,000.

under the securities Act of 1933, a registration statement for a security must be signed by: 1. a majority of the issuer's board of directors only 2. the issuer's chief executive officer and the underwriter 3. the issuer's chief executive officer, chief financial officer, and a majority of the issuer's board of directors 4. a majority of the issuers board of directors and the underwriter

3. the issuer's chief executive officer, chief financial officer, and a majority of the issuers board of directors

under the securities act of 1933, a registration statement of an issuer must contain all of the following information except: 1. the current balance sheet and profit/loss statements 2. The business of the issuer 3.the names of all the owners of the company stock 4.the identity of the officers and directors and the extent of their holdings in the issuer

3. the names of all the owners of the company stock

Over which of the following would the investment adviser representative have discretionary authority? A)An order that specifies the size of the trade and name of the security, but leaves the choice of price and time up to the investment adviser representative. B)An account in which the investment adviser representative chooses portfolio securities on behalf of the client. C)An account in which a trustee has power of attorney over another individual's account. D)An account in which a customer has power of attorney over another individual's account.

An account in which the investment adviser representative chooses portfolio securities on behalf of the client.

According to the Investment Company Act of 1940, all of the following statements are true EXCEPT: A)mutual fund shareholders must be sent semiannual statements that identify compensation paid to directors, officers, and other affiliated persons. B)12b-1 distribution charges must be approved semiannually by a majority vote of the outstanding shares and by the board of directors. C)investment companies can own no more than 3% of the shares of another investment company. D)persons convicted within the past 10 years of a securities industry crime are not allowed to serve as directors without SEC permission.

B)12b-1 distribution charges must be approved semiannually by a majority vote of the outstanding shares and by the board of directors.

Under the Investment Company Act of 1940, which of the following statements regarding the investment objective of a mutual fund are TRUE?(multiple answers) 1.Only the board of directors needs to approve changes in the investment objective. 2.The majority of outstanding shares must vote to approve changes in the investment objective. 3.The SEC must approve all changes in the investment objective. 4.The investment adviser does not set, but tries to meet, the investment objective.

The majority of outstanding shares must vote to approve changes in the investment objective. and The investment adviser does not set, but tries to meet, the investment objective.

Under the Investment Company Act of 1940, purchases by which of the following are eligible for the reduced sales charges applicable at the fund's stated breakpoints? 1.A qualified retirement plan. 2.The combined purchases of a man and a custodial account for his daughter where his wife, not he, is the custodian. 3.Two friends who have pooled their money to make a large purchase. 4.An investment club.

a qualified retirement plan ;and the combined purchases of a man and a custodial account for his daughter where his wife ,not he, is the custodian

Under the Securities Exchange Act of 1934, the term associated person would include each of the following EXCEPT a person who is associated with a broker-dealer A)in the capacity of a partner solely by virtue of a contribution of capital B)and whose functions are solely ministerial C)as a branch office manager D)as a registered representative

and whose functions are solely ministerial

The federal Securities Act of 1933 has certain requirements for those selling new issues. One of those requirements is to: A)deliver a preliminary prospectus to any person who has purchased the new issue. B)deliver a copy of the prospectus prior to the sale. C)be properly licensed prior to making the offering. D)deliver a final prospectus no later than with confirmation of the sale.

deliver a final prospectus no later than with confirmation of the sale

FinCEN Form 112, the Currency Transaction Report, is filed with the: A)SEC. B)National Security Agency. C)Federal Bureau of Investigation (FBI). D)Department of the Treasury

department of the treasury

An issuer properly files Form D in accordance with Rule 503 of Regulation D of the Securities Act of 1933. As such, the securities that are the subject of any transaction are: A)required to register with the state(s) in which they are sold. B)required to register with the SEC. C)federal covered securities. D)available only to institutional purchasers.

federal covered securities

In 1940, Congress passed the Investment Company Act. Among the provisions of this sweeping law was the listing of the classifications of investment companies. Included in that listing would be all of the following EXCEPT: A)unit investment trusts. B)holding companies. C)face amount certificate companies. D)management investment companies.

holding companies.

Under the Securities Act of 1933, which of the following transactions is(are) exempt? 1.Private transactions not involving the issuer or a broker-dealer 2.Issuer transactions that do not involve a public offering 3.Sales or offers limited to accredited investors A) one, two and three B)one only C)one and three D)one and two

one, two, and three (all of the above)

Investment Company Act of 1940 defines a interested person as: (

someone who has a material relationship with the fund, its advisor, or underwriter. Also someone who owns more than 5% of the outstanding shares would be considered interested

Jim is buying stock through a private placement. Under the Securities Act of 1933, which of the following statements is TRUE? A)The stock need not be registered with the SEC. B)The stock must first be fully registered with the SEC. C)Jim must notify the SEC that he is buying private placement securities. D)Jim will receive a letter stating his ownership.

the stock need not be registered with the SEC

Which of the following documents must an existing customer sign to establish a discretionary account? A)New account application B)Trading authorization C)Options agreement D)Customer's agreement

trading authorization

An intrastate offering (Rule 147 exemption) is limited to companies that do business in one state and limit stock or bond sales to that state's residents. Even though this offering may be exempt from SEC registration, it is not exempt from registering with that one state. Blue-sky registration (Uniform Securities Act registration) means the same thing as state registration. (true or false)

true

As under most other securities acts, a person can be almost any entity, including a corporation, partnership, unincorporated association, subdivision of a government, trust that issues shares of ownership (like a unit investment trust), or individual.(true or false)

true

The Securities Exchange Act of 1934 contains the authorization for the FED to regulate the use of credit in the securities business.(true or false)

true

Under the Securities Act of 1933, an accredited investor may be: 1.a bank, insurance company, investment company, or employee benefit plan valued in excess of $5 million. 2.a wealthy person in some cases. 3.partners, officers, and directors of the issuer for a particular issue.

.a bank, insurance company, investment company, or employee benefit plan valued in excess of $5 million. 2.a wealthy person in some cases. 3.partners, officers, and directors of the issuer for a particular issue. (all of the above)

the investment company act of 1940 allows a majority vote of outstanding shares of a registered investment company to authorize the fund to(multiple answers) 1. Borrow money from a commercial bank 2.Invest funds in securities consistent with the funds objectives 3.change the objectives of the fund 4.change the nature of its business and cease to be a investment company

1. Borrow money from a commercial bank 3.change the objectives of the fund 4. Change the nature of its business and cease to be a investment company

under the investment company act of 1940, which of the following statements regarding the renewal provisions of an investment advisers contract is NOT true: 1. The renewal may be executed orally, provided it is done within two years of the initial contract 2.The renewal must be approved by either a majority vote of the board or a majority vote of the outstanding shares as well as a majority vote of the non interested members of the board 3.the renewal must state the advisors compensation 4. the contract must be terminable upon no more than 60 days notice

1. The renewal may be executed orally, provided it is done within two years of the initial contract

under the securities exchange act of 1934, which of the following statements regarding reports required to be filed with the SEC is TRUE? 1. institutional investment managers who exercise discretion over accounts valued at $100 million or more of 13(F) securities must file reports quarterly 2.persons who become the beneficial owner of more than 5% of a security registered under the securities exchange act of 1934 must file a report within 2 days 3. institutional investment managers who excersize discretion over accounts valued at 100 million or more need not file reports if all thier clients are insurance companies 4.persons who become the beneficial owner of more than 2% of a security registered under the securities exchange act of 1934 must file a report within 5 days.

1. institutional investment managers who exercise discretion over accounts valued at $100 milion or more of 13(f) securities must file reports quarterly

to be exempt under rule 506(b) of regulation D of the securities act of 1933, the sale of securities must be limited with respect to the number of: 1.nonaccredited investors to whom the security is sold 2.shares issued 3.broker dealers who offer the securities 4.agents authorized to sell the security

1. non accredited investors to whom the security is sold

which of the following statements is NOT true? 1. open-end investment companies must have a minimum of 1 million in assets to have a public offering 2. mutual fund shares may not be purchased on margin because their shares are always public offerings of new shares 3. the sale of open-end investment company shares is a continuous public offering and must be accompanied by a prospectus 4. Mutual funds may be used as collateral in a margin account if they have been owned for more than 30 days

1. open- end investment companies must have a minimum of 1 million in assets to have a public offering

A broker-dealer makes a market in XYZ stock and places large orders for it on the open market either at or slightly above its current price with the aim of stabilizing the price. This unethical practice is best described as: 1.pegging 2.matched orders 3. straddling 4. front running

1. pegging

Under the Securities Act of 1933, the term "person" could refer to which of the following? 1.A subdivision of a government. 2.An unincorporated amateur athletic club. 3.A nonprofit, charitable corporation.

1.A subdivision of a government. 2.An unincorporated amateur athletic club. 3.A nonprofit, charitable corporation.(all of the above)

Which of the following statements regarding the handling of discretionary accounts are TRUE?(multiple answers) 1.Discretionary accounts must be reviewed frequently by the designated supervisory person. 2.An investment adviser representative may decide, without discretionary authority, the security to buy or sell and the amount to buy or sell. 3.A husband or wife may at any time exercise discretionary authority in the spouse's account without specific written authorization. 4.An investment adviser representative may decide, without discretionary authority, the time at which to execute a trade.

1.Discretionary accounts must be reviewed frequently by the designated supervisory person. and 4.An investment adviser representative may decide, without discretionary authority, the time at which to execute a trade.

Which of the following statements are TRUE of a discretionary account at a broker-dealer? 1.It must be approved by a designated supervisory individual of the firm. 2.It must be reviewed frequently to minimize the chances that the account has been churned. 3.A discretionary order may be placed once the customer has placed a power of attorney in the mail. 4.It must be approved by the Administrator of the state of residence of the client.

1.It must be approved by a designated supervisory individual of the firm. 2.It must be reviewed frequently to minimize the chances that the account has been churned.

To be in compliance with the Securities Act of 1933, the sale of which of the following securities would require delivery of a prospectus? 1.Primary offering of a closed-end investment company registered under the Investment Company Act of 1940. 2.Primary offering of 5-year U.S. treasury notes sold to an individual investor. 3.Private placement sold under the provisions of Regulation D. 4.Sale of shares of an open-end investment company whose first public offering was 23 years ago.

1.Primary offering of a closed-end investment company registered under the Investment Company Act of 1940. and 4.Sale of shares of an open-end investment company whose first public offering was 23 years ago.

Under the Securities Exchange Act of 1934, which of the following is (are) TRUE regarding the authority of the SEC to suspend trading? (multiple answers) 1.The SEC may suspend all trading on a specific exchange for up to 90 days. 2.The SEC may summarily suspend trading on a particular nonexempt security for up to 10 days. 3.The SEC may suspend trading on exempt securities.

1.The SEC may suspend all trading on a specific exchange for up to 90 days. and 2.The SEC may summarily suspend trading on a particular nonexempt security for up to 10 days.

Which of the following is(are) TRUE regarding the Securities Exchange Act of 1934? 1.The act bars the use of credit to purchase new issues. 2.The act prohibits the simultaneous purchase and sale of a security to create the appearance of trading. 3.The act prohibits the spread of false rumors to induce others to trade.

1.The act bars the use of credit to purchase new issues. 2.The act prohibits the simultaneous purchase and sale of a security to create the appearance of trading. 3.The act prohibits the spread of false rumors to induce others to trade.(all of the above)

Jasper Whitlock is considered an affiliated person of the Tahor Clean Energy Mutual Fund. Under the Investment Company Act of 1940, Mr. Whitlock is prohibited from( multiple answers) 1.borrowing from the fund (money or property) 2.buying anything from the fund, except shares of the fund 3.selling anything to the fund, except shares of the fund

1.borrowing from the fund (money or property) 2.buying anything from the fund, except shares of the fund 3.selling anything to the fund, except shares of the fund (all of the above)

which of the following individuals would be considered a non interested person in a mutual fund: 1. a person who holds a position with the funds underwriter 2. a member of the board of directors who does not hold another position within the investment company 3. a member of the board of directors who is also employed as the investment advisor 4.a shareholder who owns 10% of the funds shares

2. A member of the board of directors who does not hold another position within the investment company

under the securities exchange act of 1934, which of the following is TRUE regarding the jurisdiction of the SEC over a person who violates the rules of the Municipal Securities Rule making board? 1. The sec has the authority to investigate such violations only if the person is a financial institution 2.The SEC has the authority to investigate such violations unless the person is a financial institution 3. The SEC has the authority to investigate such violations even if the person is a financial institution 4. Only the MSRB has the authority to investigate violations of its rules

2. The SEC has authority to investigate such violations unless the person is a financial institution

Charlotte is an agent of Gibraltar Securities. Her most active customer told charolette that he is thinking about buying 10,000 shares of a retailer's stock for which gibraltar will be participating in the underwriting process. The SEC release date for the stock is anticipated within 10 business days. What may charlotte sent to the client today? 1.an order request 2.The preliminary prospectus 3. The preliminary prospectus and a reprint of a popular advertisement placed by the issuing corporation 4.the final prospectus

2. The preliminary prospectus

which of the following describe indications of interest secured during the 20-day cooling off period? 1. Binding on the customer 2.Nonbinding on the customer 3.binding on the broker dealer 4. Nonbinding on the broker dealer

2. nonbinding on the customer 4. nonbinding on the broker dealer (indications of interest are non binding on either party)

Which of the following are regulated under the Securities Exchange Act of 1934? (multiple answers) 1.New issues. 2.Broker-dealers. 3.Transfer agents.

2.Broker-dealers. 3.Transfer agents.

Under the Investment Company Act of 1940, which of the following statements is(are) TRUE about an investment company that wishes to contract with an outside investment adviser to manage its portfolio? 1.This is prohibited under the act. 2.Investment companies may employ outside advisers if a written contract is executed. 3.The initial contract must be approved by either the board of directors or a majority vote of the outstanding shares.

2.Investment companies may employ outside advisers if a written contract is executed.

which of the following statements regarding a red herring is NOT true? 1. additional information may be added to a red herring at a later date 2.a red herring is used to accept indications of interest from investors 3. An agents may accept funds to be placed in escrow until the effective date if the request to do so is made by a potential purchaser 4.the final offering price does not appear in a red herring

3. an agent may accept funds to be placed in escrow until the effective date if the request to do so it made by a potential purchaser

Which of the following statements is TRUE regarding the civil liability provisions of the Securities Act of 1933? A)Only those who actually signed the registration statement are exposed to potential liability. B)The statute of limitations for civil suits is three years from the date of discovery. C)Purchasers may waive their rights to suit under the civil liability provisions if done so by the purchase contract. D)If the registration statement contains misrepresentations that were made deliberately, criminal penalties, in addition to civil ones, may be levied.

D)If the registration statement contains misrepresentations that were made deliberately, criminal penalties, in addition to civil ones, may be levied.

The XYZ corporation, listed on the NYSE, has 100 million shares of common stock outstanding. Warren has owned 4 million shares since 1999. If Warren were to acquire 1.1 million additional shares, which of the following statements is CORRECT? A)Schedule 13D would have to be filed before the end of the 2nd business day following the transaction. B)Because Warren does not own more than 10% of the outstanding shares, no form is required to be filed. C)Form 144 would have to be filed concurrent with the transaction. D)Schedule 13D would have to be filed within 10 business days of the transaction.

Schedule 13D would have to be filed within 10 business days of the transaction

Under the Securities Act of 1933, when registering securities with the SEC, who must sign the registration statement? 1.The chief executive officer (CEO). 2.The chief operating officer (COO). 3.A majority of the board. 4.The chief financial officer (CFO).

all of the above : CEO,COO, majority of the board, CFO

under the securities act of 1933 which of the following actions are exempt? (multiple answers) 1.private transactions not involving the issuer or the broker dealer 2.issuer transactions that do not involve a public offering 3.sales or offers limited to accredited investors

all of the above.

Which of the following statements regarding an investment company's board of directors is NOT true? A)The board of directors contracts with an outside investment adviser or portfolio manager to invest the cash and securities held in the fund's portfolio. B)An investment company's board of directors manages the portfolio on behalf of the investor shareholders. C)No convicted felon or person convicted of a misdemeanor involving the securities industry ​within the past 10 years ​may serve on the board of directors of an investment company. D)An investment company's board of directors concerns itself with policy and administrative matters.

an investment company's board of directors manages the portfolio on behalf of the investors shareholders

Under the Securities Exchange Act of 1934, an exchange is: A)any transaction involving a security. B)an organization which provides facilities for bringing together buyers and sellers of securities. C)an organization of securities professionals designed to promote fair practices in doing business with the public. D)a disposition of a security for value.

an organization which provides facilities for bringing together buyers and sellers of securities.

The first of the federal securities acts was the Securities Act of 1933. This act requires persons selling a new offering to their clients to: A)deliver a preliminary (red herring) prospectus prior to the sale. B)be properly registered prior to making the offer. C)deliver a copy of the registration statement no later than with confirmation of the sale. D)deliver an effective (final) prospectus no later than with confirmation of the sale.

deliver an effective (final) prospectus no later than with confirmation of the sale.

Under the Investment Company Act of 1940, which of the following statements is(are) TRUE about an investment company that wishes to contract with an outside investment adviser to manage its portfolio? 1.This is prohibited under the act. 2.Investment companies may employ outside advisers if a written contract is executed. 3.The initial contract must be approved by either the board of directors or a majority vote of the outstanding shares.

investment companies may employ outside advisers if a written contract is executed

All of the following statements regarding a closed-end investment company are true EXCEPT: A)it is a type of management company. B)it may redeem its own shares. C)it differs from a mutual fund. D)it sells at the market price based on supply and demand.

it may redeem its own shares

Discounts may be made to directors, officers, partners, employees, and agents of a fund, as well as to its investment adviser and principal underwriter. A husband and wife and all dependent children younger than 21 qualify as a single person for the purpose of obtaining a quantity discount. But other associations acting collectively, such as the members of the investment club, do not qualify as a single person for this purpose.( true or false)

true

If offerings are not made to the public, registration can generally be avoided. The purpose of the Securities Act of 1933 was to protect the public in a new issue. The private offering exemption is used when the offering is made to 35 or fewer nonaccredited purchasers within a 12-month period and no general solicitation (advertising) is used [506(b)]​. In addition to private offerings, offers and sales limited to accredited investors are also exempt​, but they may have​ public solicitation​, [506(c)]​. (true or false)

true

One of the requirements of the Investment Company Act of 1940 is that the contract between a management investment company (open or closed-end) must be in writing. The initial contract must be approved by a majority vote of the outstanding shares and the "non-interested" members of the board of directors. It is renewed annually by either a majority vote of the outstanding shares or the board of directors as well as a majority of the directors who are considered to be non-interested parties. (true or false)

true

Private placements are exempt transactions under Regulation D of the Securities Act of 1933 and are therefore exempt from registration. (true or false)

true

Section 13(d) of the Securities Exchange Act of 1934 requires filing of a Schedule 13D within 10 business days of the transaction once a person becomes an owner of more than 5% of the outstanding voting shares of a reporting company ( true or false)

true

The SEC neither approves nor disapproves an issue, nor does it pass on the accuracy or adequacy (completeness) of the information presented in a prospectus. (true or false)

true