Question 1

Any shareholder owning more than five (5)percent of any class of the corporation's equity securities is statutorily defined as an insider and must file with the SEC a disclosure statement regarding such ownership and all related transactions.

Accepted Answer

A) True 
 B)False

Question 2

Rule 10b-5 only applies to registered securities.

Accepted Answer

A) True 
 B)False

Question 3

The registration requirement of the Securities Act of 1933 applies to:

Accepted Answer

A)  the issuing of stocks,bonds,and other investment securities. 
B)  the issuing of certificates of deposit by a national bank. 
C)  shares issued by nonprofit corporations. 
D)  issues of $1.5 million or more.

Question 4

At least 30 days must elapse from the date of a company's filing a registration statement with the SEC to the date the registration becomes effective.

Accepted Answer

A) True 
 B)False

Question 5

A prospectus sets forth:

Accepted Answer

A)  the key information contained in the registration statement. 
B)  information on stocks approved by the SEC. 
C)  information that the SEC has not reviewed. 
D)  none of the above.

Question 6

State statutes designed to protect the public from the sale of worthless stocks and bonds are called:

Accepted Answer

A)  antifraud acts. 
B)  blue sky laws. 
C)  clear sky laws. 
D)  none of the above.

Question 7

All private or limited offerings of securities are exempt from the SEC registration requirements.

Accepted Answer

A) True 
 B)False

Question 8

Taylor,a securities lawyer for a major Wall Street law firm,worked on numerous successful takeover bids of companies listed on the New York Stock Exchange.Prior to the public announcement of the takeover bids,Taylor provided information to Rogers (his stockbroker)and to Price (his mistress)about certain planned takeover bids on which he had provided legal services.Rogers,who was aware of the relationship between Taylor and Price,made purchases of the target companies on Rogers' and Price's behalf,netting them more than a million dollars in profits each.The SEC brings an action against Taylor,Rogers,and Price under Rule 10b-5 and the Insider Trading Sanctions Act of 1984.Taylor defends that he is an outsider not subject to the 1984 law and Rule 10b-5,and that he received no personal benefit.Rogers and Price defend that they were merely acting on stock market tips received from a person who did not personally benefit from the disclosure.Decide.

Accepted Answer

The answer of Taylor,a securities lawyer for a major Wall...

Question 9

Under the United States Supreme Court's definition,an investment contract exists if the following elements are present: (1)an investment of money,(2)a common enterprise,and (3)an expectation of future profits from the efforts of others.

Accepted Answer

A) True 
 B)False

Question 10

A corporation or group of investors may seek to acquire control of another corporation by offering cash for all of its shares made available for sale by a certain date.This action is called a(n):

Accepted Answer

A)  cash tender offer. 
B)  stock redemption offer. 
C)  stock reclamation offer. 
D)  offer for value.

Question 11

Under the Litigation Reform Act of 1995,issuers of forward-looking statements that were not knowingly false when made have a safe harbor from related lawsuits if appropriate cautionary language was included.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following federal laws grants the SEC the power to suspend all trading when markets are excessively volatile?

Accepted Answer

A)  The Trust Indenture Act of 1939 
B)  The Market Reform Act of 1990 
C)  The Investment Advisors Act of 1940 
D)  The Remedies Act of 1990

Question 13

Provision for exemption from the registration requirements of the Securities Act of 1933 is made for offerings made solely to accredited investors by SEC Regulation:

Accepted Answer

A)  A. 
B)  B. 
C)  C. 
D)  D.

Exam 46: Securities Regulation

Any shareholder owning more than five (5)percent of any class of the corporation's equity securities is statutorily defined as an insider and must file with the SEC a disclosure statement regarding such ownership and all related transactions.

Rule 10b-5 only applies to registered securities.

The registration requirement of the Securities Act of 1933 applies to:

At least 30 days must elapse from the date of a company's filing a registration statement with the SEC to the date the registration becomes effective.

A prospectus sets forth:

State statutes designed to protect the public from the sale of worthless stocks and bonds are called:

All private or limited offerings of securities are exempt from the SEC registration requirements.

Under the United States Supreme Court's definition,an investment contract exists if the following elements are present: (1)an investment of money,(2)a common enterprise,and (3)an expectation of future profits from the efforts of others.

A corporation or group of investors may seek to acquire control of another corporation by offering cash for all of its shares made available for sale by a certain date.This action is called a(n) :

Under the Litigation Reform Act of 1995,issuers of forward-looking statements that were not knowingly false when made have a safe harbor from related lawsuits if appropriate cautionary language was included.

Which of the following federal laws grants the SEC the power to suspend all trading when markets are excessively volatile?

Provision for exemption from the registration requirements of the Securities Act of 1933 is made for offerings made solely to accredited investors by SEC Regulation: