Question 1

An employee of an investment house who executes orders on the floor of the exchange for customers of the firm is called a:

Accepted Answer

A) floor broker. 
B) registered trader. 
C) commission broker. 
D) specialist. 
E) dealer. 
A) floor broker. 
B) registered trader. 
C) commission broker. 
D) specialist. 
E) dealer. A

Question 2

A shelf registration enables an investment banker to sell a small portion of an issue without forming a syndicate.

Accepted Answer

A) True 
 B)False  True

Question 3

In the NASDAQ market, it is now permitted to charge fees for data feeds and market information.

Accepted Answer

A) True 
 B)False  True

Question 4

The rise of financial-service firms through mergers and the consolidation of brokerage companies have resulted from significant changes in the banking laws.

Accepted Answer

A) True 
 B)False

Question 5

The major exchange for warrants, options, and commodity futures is the:

Accepted Answer

A) American Stock Exchange. 
B) New York Stock Exchange. 
C) NASDAQ. 
D) None of the above 
A) American Stock Exchange. 
B) New York Stock Exchange. 
C) NASDAQ. 
D) None of the above

Question 6

The cost of compliance with the Sarbanes-Oxley Act has had little effect on the willingness of foreign companies to list their shares on U.S. stock exchanges.

Accepted Answer

A) True 
 B)False

Question 7

Secondary markets are for existing securities.

Accepted Answer

A) True 
 B)False

Question 8

The regional exchange plays an important part in the trading markets.

Accepted Answer

A) True 
 B)False

Question 9

The use of the NASDAQ Automated Quotation System has increased the number of equity trades on the American Stock Exchange.

Accepted Answer

A) True 
 B)False

Question 10

The Gramm-Leach-Bliley Act repealed the Glass-Steagall Act, which restricted commercial banks from also being in the investment banking business.

Accepted Answer

A) True 
 B)False

Question 11

Primary markets are for new issues of securities.

Accepted Answer

A) True 
 B)False

Question 12

Specialists buy and sell for their own account.

Accepted Answer

A) True 
 B)False

Question 13

The Sarbanes-Oxley Act:

Accepted Answer

A) has reduced the number of foreign companies willing to list their shares on U.S. exchanges. 
B) was enacted under the Securities Exchange Act of 1934. 
C) reduces the reporting requirements for publicly traded firms. 
D) has made it possible for small firms to list their shares in the public markets. 
E) was the loophole that enabled corporate executives to misrepresent their financial statements during the late 1990s and early 2000s. 
A) has reduced the number of foreign companies willing to list their shares on U.S. exchanges. 
B) was enacted under the Securities Exchange Act of 1934. 
C) reduces the reporting requirements for publicly traded firms. 
D) has made it possible for small firms to list their shares in the public markets. 
E) was the loophole that enabled corporate executives to misrepresent their financial statements during the late 1990s and early 2000s.

Question 14

Many large technology companies listed on NASDAQ could easily meet the NYSE listing standards.

Accepted Answer

A) True 
 B)False

Question 15

Program trading

Accepted Answer

A) means that when a given market indicator reaches a certain point, a large sale or purchase of securities may take place. 
B) has been argued to affect the market by accelerating price movements. 
C) is likely to be voluntarily restricted by the securities exchanges and their member firms. 
D) All of the above 
A) means that when a given market indicator reaches a certain point, a large sale or purchase of securities may take place. 
B) has been argued to affect the market by accelerating price movements. 
C) is likely to be voluntarily restricted by the securities exchanges and their member firms. 
D) All of the above

Question 16

Because of the 1987 market collapse, the SEC put circuit breakers into effect.

Accepted Answer

A) True 
 B)False

Question 17

The major functions of an investment banker are performed as part of the operations of the secondary market.

Accepted Answer

A) True 
 B)False

Question 18

Under the Securities Act of 1933, the SEC can certify that a stock is fairly priced.

Accepted Answer

A) True 
 B)False

Question 19

The exchange with the largest dollar volume in major companies and which has the most restrictive listing requirements is:

Accepted Answer

A) the New York Stock Exchange. 
B) the American Exchange. 
C) the NASDAQ Stock Market. 
D) the Securities Exchange. 
A) the New York Stock Exchange. 
B) the American Exchange. 
C) the NASDAQ Stock Market. 
D) the Securities Exchange.

Question 20

During the last decade, the financial markets have changed at a rapid pace.

Accepted Answer

A) True 
 B)False

Exam 2: Security Markets

An employee of an investment house who executes orders on the floor of the exchange for customers of the firm is called a:

A shelf registration enables an investment banker to sell a small portion of an issue without forming a syndicate.

In the NASDAQ market, it is now permitted to charge fees for data feeds and market information.

The rise of financial-service firms through mergers and the consolidation of brokerage companies have resulted from significant changes in the banking laws.

The major exchange for warrants, options, and commodity futures is the:

The cost of compliance with the Sarbanes-Oxley Act has had little effect on the willingness of foreign companies to list their shares on U.S. stock exchanges.

Secondary markets are for existing securities.

The regional exchange plays an important part in the trading markets.

The use of the NASDAQ Automated Quotation System has increased the number of equity trades on the American Stock Exchange.

The Gramm-Leach-Bliley Act repealed the Glass-Steagall Act, which restricted commercial banks from also being in the investment banking business.

Primary markets are for new issues of securities.

Specialists buy and sell for their own account.

The Sarbanes-Oxley Act:

Many large technology companies listed on NASDAQ could easily meet the NYSE listing standards.

Program trading

Because of the 1987 market collapse, the SEC put circuit breakers into effect.

The major functions of an investment banker are performed as part of the operations of the secondary market.

Under the Securities Act of 1933, the SEC can certify that a stock is fairly priced.

The exchange with the largest dollar volume in major companies and which has the most restrictive listing requirements is:

During the last decade, the financial markets have changed at a rapid pace.

The Investment Setting

Participating in the Market

Investment Companies: Mutual Funds, Exchange-Traded Funds, Closed-End Funds, and Unit Investment Trusts

Economic Activity

Industry Analysis

Valuation of the Individual Firm

Financial Statement Analysis

Efficient Markets and Anomalies

Behavioral Finance and Technical Analysis

Bond and Fixed-Income Fundamentals

Principles of Bond Valuation and Investment

Convertible Securities and Warrants

Put and Call Options

Commodities and Financial Futures

Stock Index Futures and Options

A Basic Look at Portfolio Management and Capital Market Theory

Duration and Bond Portfolio Management

International Securities Markets

Investments in Real Assets

Alternative Investments: Private Equity and Hedge Funds

Measuring Risks and Returns of Portfolio Managers

A Comprehensive Analysis for Real Estate Investment Decisions

The Makeup of Institutional Investors

Filters