Series 7 Top-Off Exam Quiz Lesson 6 Securities Act of 1933

This is Series 7 Top-Off Exam Quiz Lesson 6 Securities Act of 1933

1. Which of the following is true about the Securities Exchange Act of 1934?

(Select all that apply.)

A. It applies to exempt securities.

B. It determines what fair trading practices are.

C. It regulates the secondary trading of securities.

D. It was established by the Securities and Exchange Commission.

2. Which of the following is contained in a 10-K? (Select all that apply.)

A. balance sheet

B. cash flow statement

C. compensation of officers

D. income statement

3. The 10-Q is an audited financial report submitted quarterly to the Securities and Exchange Commission.

A. True

B. False

4. A ___ is filed if the company changes its name or there’s a 5% or greater change in the number of shares outstanding.

A. 10-C

B. 13-G

C. 15-B

D. 8-K

5. Which of the following is required from the broker-dealers by the Securities Exchange Act of 1934?

(Select all that apply.)

A. buy back stocks for customers that reneged on their transactions

B. electronically deliver clients’ confirmation and statements

C. maintain a minimum net capital

D. send customers a copy of their income statement

6. Under ___, margins are regulated from brokers to their customers.

A. Regulation D

B. Regulation M

C. Regulation T

D. Regulation U

7. Broker-dealers are allowed to disclose to customers the routing of the customers’ orders.

A. True

B. False

8. It is a totally anonymous matching of buy and sell orders.

A. alternative trading system

B. electronic exchange

C. electronics communication network

D. physical exchange

9. Which of the following are/were physical exchanges?

(Select all that apply.)

A. Cincinnati Stock Exchange

B. New York Stock Exchange (NYSE)

C. Pacific Stock Exchange

D. Philadelphia Stock Exchange

10. Which of the following is true about penny stocks?

(Select all that apply.)

A. They are sold on the over-the-counter bulletin board.

B. They are unsolicited orders.

C. They are traded on the NASDAQ and other listed exchanges.

D. They sell at less than $5.

11. The broker is not required to assess a penny stock buyer’s financial situation if the buyer is a/an ___.

(Select all that apply.)

A. accredited investor

B. client whose order is unsolicited

C. insider

D. interstate citizen

12. It is trading on nonpublic material information on the company.

A. front running

B. insider trading

C. pegging

D. wash trade

13. This is the catchall rule that prohibits anything fraud even if it is not specifically prohibited in the Securities Exchange Act of 1934.

A. Rule 10b-5

B. Rule 127-c

C. Rule 144A

D. Rule 145

14. For unlawful practices under the Securities Exchange Act of 1934, suits can be brought within ___ of discovery.

A. six months

B. one year

C. two years

D. three years

15. If a control person owns a position of a stock and he wants to lock in his profit or loss, he can ___.

A. dribble out

B. peg the stock

C. short against the box

D. short sell the stock

16. Anybody that has nonpublic material information on the company is considered an insider.

A. True

B. False

17. In the United Sates, they are exempted from the rules that prohibit insider trading.

(Select all that apply.)

A. congressmen

B.