A prospective issuer of securities must hire which of the following:
Select one:
a. A publicity agency
b. An advertising agency
c. A printer for the prospectus
d. An insurance broker
A red herring:
Select one:
a. Is also known as an 8-K report
b. Is also called a prospectus
c. Represents an offer to sell a security
d. Is a preliminary version of a prospectus
A share of stock represents the right to:
Select one:
a. Receive cash from the issuing company equal to the market value of the stock
b. An equal share of the assets of a firm
c. Participate in active management decisions of a firm
d. A share of future profits of a firm
Bonds issued by a company to raise money:
Select one:
a. Mean that the company has incurred debt that is to be repaid to the holders of the bonds
b. Can be traded on the securities market
c. Are securities
d. All of the above
Credit bureaus are regulated by:
Select one:
a. The Fair Credit Reporting Act
b. The Legitimate Credit Reporting Act
c. The Credit CARD Act
d. Congress
Equity instruments, like stock, specify the amount of money, the time period it is to be held, and the rate of return to be paid.
Select one:
a. True
b. False
Insider trading is:
Select one:
a. Legal if no profit is made
b. Legal if the insider gets an outsider to buy or sell
c. Illegal because insiders are strictly prohibited from stock trading under SEC Rule 10b-5
d. Illegal when insiders trade based on information they have a fiduciary duty not to trade on
Nutritional supplements are:
Select one:
a. Subject to the same regulations as drugs
b. Subject to stricter regulations than drugs
c. Subject to fewer regulations than drugs
d. More expensive than drugs
Regulation Fair Disclosure requires that public companies must file reports with the SEC to report significant financial developments whenever they happen.
Select one:
a. True
b. False
The Consumer Leasing Act would apply to which of the following leases:
Select one:
a. Living room furniture for three months
b. An apartment for a year
c. A car for a week
d. A big-screen television for a year
The Credit Card Accountability Responsibility and Disclosure Act (Credit CARD Act) states that gift cards may not expire for at least five years.
Select one:
a. True
b. False
The FDA may seize shipments of products that are falsely labeled.
Select one:
a. True
b. False
The Federal Trade Commission regulates:
Select one:
a. Deceptive business practices
b. False advertising claims
c. Unfair business practices
d. All of the above
The Investment Company Act (ICA):
Select one:
a. Holds investment companies liable to private parties for violations of the Act
b. Holds investment companies liable to the SEC for violations of the Act
c. Makes the activities of investment companies subject to regulation
d. All of the above
The Mail Order Rule requires goods to be delivered by mail to arrive within clearly set time or allow the customer out of the deal.
Select one:
