Question 1

Which of the following is true of a Regulation A offering?

Accepted Answer

A) It imposes resale restrictions on the securities it offers. 
B) It requires issuers to prepare a registration statement for offers exceeding $100,000. 
C) It requires more disclosure than a registration statement and is more costly to prepare. 
D) It mandates that an offering circular be provided to investors prior to their purchase of securities. 
A) It imposes resale restrictions on the securities it offers. 
B) It requires issuers to prepare a registration statement for offers exceeding $100,000. 
C) It requires more disclosure than a registration statement and is more costly to prepare. 
D) It mandates that an offering circular be provided to investors prior to their purchase of securities.

Question 2

The ________ coordinates state securities laws with federal securities laws.

Accepted Answer

A) Insider Trading Sanctions Act 
B) Securities Exchange Act of 1934 
C) Securities Act of 1933 
D) Uniform Securities Act 
A) Insider Trading Sanctions Act 
B) Securities Exchange Act of 1934 
C) Securities Act of 1933 
D) Uniform Securities Act

Question 3

Which of the following is an example of insider trading?

Accepted Answer

A) An employee uses material nonpublic information to make a profit by trading in the securities of the company. 
B) A manager purchases all the shares of a corporation available to the public. 
C) A director purchases enough shares of a public company to gain a majority stake in its management. 
D) An employee sells his shares to another employee without notifying the company. 
A) An employee uses material nonpublic information to make a profit by trading in the securities of the company. 
B) A manager purchases all the shares of a corporation available to the public. 
C) A director purchases enough shares of a public company to gain a majority stake in its management. 
D) An employee sells his shares to another employee without notifying the company.

Question 4

The ________ imposes liability under Section 10(b)and Rule 10b-5 on an outsider who misappropriates information about a company,in violation of his or her fiduciary duty,and then trades in the securities of that company.

Accepted Answer

A) Insider Trading Sanctions Act 
B) Sarbanes-Oxley Act 
C) tort of appropriation 
D) misappropriation theory 
A) Insider Trading Sanctions Act 
B) Sarbanes-Oxley Act 
C) tort of appropriation 
D) misappropriation theory

Question 5

Only an established company is permitted to sell new securities to the public.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following best defines an initial public offering (IPO)?

Accepted Answer

A) the issuance of an offering statement to the public prior to purchase 
B) the filing of a registration statement by an issuer 
C) the disclosure document released for public scrutiny 
D) the issuance of securities by an issuer to the public 
A) the issuance of an offering statement to the public prior to purchase 
B) the filing of a registration statement by an issuer 
C) the disclosure document released for public scrutiny 
D) the issuance of securities by an issuer to the public

Question 7

An offering circular must be provided to the investors immediately after the purchase of a Regulation A offering.

Accepted Answer

A) True 
 B)False

Question 8

The Securities Act of 1933 is a federal statute that primarily regulates the issue of securities by companies and other businesses.

Accepted Answer

A) True 
 B)False

Question 9

EDGAR is the world's largest electronic securities exchange.

Accepted Answer

A) True 
 B)False

Question 10

The Securities Act of 1933 regulates the issuance and sale of securities online.

Accepted Answer

A) True 
 B)False

Question 11

The ________ is a federal agency that is created by the Securities Exchange Act of 1934 and is empowered to administer federal securities laws.

Accepted Answer

Securities

Question 12

Which of the following is true of the small offering exemption?

Accepted Answer

A) Securities coming under this exemption cannot be sold through general selling efforts to the public. 
B) Securities coming under this exemption can only be sold to accredited investors. 
C) Securities coming under this exemption can only be sold to nonaccredited investors. 
D) Securities coming under this exemption have no resale restrictions imposed on them. 
A) Securities coming under this exemption cannot be sold through general selling efforts to the public. 
B) Securities coming under this exemption can only be sold to accredited investors. 
C) Securities coming under this exemption can only be sold to nonaccredited investors. 
D) Securities coming under this exemption have no resale restrictions imposed on them.

Question 13

The ________ is a federal statute primarily designed to prevent fraud in the trading of securities after they are issued.

Accepted Answer

A) Securities Act of 1933 
B) Securities Exchange Act of 1934 
C) Sarbanes-Oxley Act of 2002 
D) Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 
A) Securities Act of 1933 
B) Securities Exchange Act of 1934 
C) Sarbanes-Oxley Act of 2002 
D) Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

Question 14

Which of the following is classified under "common securities"?

Accepted Answer

A) real estate 
B) bullion 
C) a debenture 
D) a bank deposit account 
A) real estate 
B) bullion 
C) a debenture 
D) a bank deposit account

Question 15

An exemption from registration which states that securities transactions not made by an issuer,an underwriter,or a dealer do not have to be registered with the Securities and Exchange Commission (SEC)is known as a(n)________ exemption.

Accepted Answer

The answer of An exemption from registration which states that...

Question 16

________ allows small companies to raise capital from many small-dollar investors through Web-based platforms.

Accepted Answer

The answer of ________ allows small companies to raise capital...

Question 17

How does Section 16(b)of the Securities Exchange Act of 1934 protect the interests of a corporation? Explain with an example.

Accepted Answer

Section 16(b)of the Securities Exchange

Exam 17: Investor Protection, E-Securities, and Wall Street Reform

Which of the following is true of a Regulation A offering?

The ________ coordinates state securities laws with federal securities laws.

Which of the following is an example of insider trading?

The ________ imposes liability under Section 10(b)and Rule 10b-5 on an outsider who misappropriates information about a company,in violation of his or her fiduciary duty,and then trades in the securities of that company.

Only an established company is permitted to sell new securities to the public.

Which of the following best defines an initial public offering (IPO)?

An offering circular must be provided to the investors immediately after the purchase of a Regulation A offering.

The Securities Act of 1933 is a federal statute that primarily regulates the issue of securities by companies and other businesses.

EDGAR is the world's largest electronic securities exchange.

The Securities Act of 1933 regulates the issuance and sale of securities online.

The ________ is a federal agency that is created by the Securities Exchange Act of 1934 and is empowered to administer federal securities laws.

Which of the following is true of the small offering exemption?

The ________ is a federal statute primarily designed to prevent fraud in the trading of securities after they are issued.

Which of the following is classified under "common securities"?

An exemption from registration which states that securities transactions not made by an issuer,an underwriter,or a dealer do not have to be registered with the Securities and Exchange Commission (SEC)is known as a(n)________ exemption.

________ allows small companies to raise capital from many small-dollar investors through Web-based platforms.

How does Section 16(b)of the Securities Exchange Act of 1934 protect the interests of a corporation? Explain with an example.

Legal Heritage and the Digital Age

Ethics and Social Responsibility of Business

Courts, Jurisdiction, and Administrative Agencies

Alternative, Judicial, and E-Dispute Resolution

Constitutional Law for Business and E-Commerce

Torts and Strict Liability

Cyber Law and Cyber Crimes

Intellectual Property and Cyber Piracy

Formation and Requirements of Contracts

Performance and Breach of Contracts

Digital Law and E-Commerce

UCC Sales Contracts, Leases, and Warranties

Credit, Secured Transactions, and Bankruptcy

Small Business, General Partnerships, and Limited Partnerships

Limited Liability Companies, Limited Liability Partnerships, and Special Forms of Business

Corporations and Corporate Governance

Agency Law

Equal Opportunity in Employment

Employment Law and Worker Protection

Labor Law and Immigration Law

Antitrust Law and Unfair Trade Practices

Consumer Protection

Environmental Protection

Real Property and Land Use Regulation

International and World Trade Law

Accountants' Duties and Liability

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