Question 1

"Presidential Profits." Linda was president of a publicly traded tractor company, Tough Tractors. Linda became aware that stock in her company would likely increase significantly in value because her company had a contract to purchase the assets of Rough Tractors. The boards of both companies wanted the information kept confidential until the purchase was complete and a news release was made. Before the news was made public, Linda immediately purchased a significant number of shares in Tough Tractors. Linda also told her friend Frank about the contract to purchase assets although she told him to keep it quiet because it had not been made public yet. Nevertheless, unable to keep a secret, Frank told his brother, George. Frank and George purchased a number of shares of stock in Tough Tractors prior to any public announcement of the sale. After the public announcement was made and the purchase of assets went through, Linda, George and Frank, all sold their shares in Tough Tractors and made a nice profit.
-For which of the following is Linda liable?

Accepted Answer

A)   Her own profits only.
B)   Her profits and those of Frank only.
C)   Her profits, the profits of Frank, and also the profits of George.
D)   Her profits only plus a 10% penalty.
E)   Nothing because she acted legally.F) C) and D)
G) None of the above

Question 2

Once an issuer files a registration statement and prospectus, the ______ period begins.

Accepted Answer

A)   Advertising
B)   Post-filing
C)   Waiting
D)   Approval
E)   ProspectusF) A) and C)
G) All of the above

Question 3

Which of the following is true regarding the case opener, the case in which Martha Stewart was charged with insider trading after selling stock in a company based on information that her stockbroker gave her that the CEO of the company and his daughter had just sold all of their company stock?

Accepted Answer

A)   She was not convicted of insider trading and sentenced to jail.
B)   After a jury trial she was found innocent of insider trading and did not go to jail for anything.
C)   She was not convicted of insider trading, but she went to jail for convictions relating to statements made to SEC investigators.
D)   She pled guilty to lesser offenses on all counts, paid a large fine, and all charges were dismissed.
E)   Charges were dismissed after she agreed to repurchase all shares of stock.F) A) and B)
G) B) and D)

Question 4

Which of the following refer to state securities laws?

Accepted Answer

A)   Pink-sky laws
B)   Blue-sky laws
C)   Orange-sky laws
D)   Brown-ground laws
E)   Green-grass lawsF) A) and E)
G) B) and D)

Question 5

Which of the following is a term, if any, that would describe Scott as an investor?

Accepted Answer

A)   Approved
B)   Sophisticated
C)   Accredited
D)   Superior
E)   There is no specific term to describe Scott as he is considered the same as any other investor.F) B) and C)
G) A) and D)

Question 6

Which of the following oversees the purchase and sale of securities?

Accepted Answer

A)   The Securities Act of 1933
B)   The Securities Exchange Act of 1934
C)   The Depression Act of 1932
D)   The Oversight Act of 1935
E)   The Stock and Bond Act of 1930F) B) and C)
G) A) and E)

Question 7

Which of the following describes investment banking firms that purchase securities from the issuing corporation with the intent of selling them to brokerage houses, which then sell them to the public?

Accepted Answer

A)   Underwriters
B)   Offerors
C)   Issuers
D)   Accredited purchasers
E)   Unaccredited purchasersF) A) and B)
G) A) and E)

Exam 41: Corporations: Securities and Investor Protection

Which of the following is a term, if any, that would describe Scott as an investor?

Correct Answer
verified

Which of the following is true regarding the case opener, the case in which Martha Stewart was charged with insider trading after selling stock in a company based on information that her stockbroker gave her that the CEO of the company and his daughter had just sold all of their company stock?

Correct Answer
verified

Once an issuer files a registration statement and prospectus, the ______ period begins.

Correct Answer
verified

Correct Answer
verified

Which of the following oversees the purchase and sale of securities?

Correct Answer
verified

Which of the following describes investment banking firms that purchase securities from the issuing corporation with the intent of selling them to brokerage houses, which then sell them to the public?

Correct Answer
verified

Which of the following refer to state securities laws?

Correct Answer
verified

Exam 41: Corporations: Securities and Investor Protection

Which of the following is a term, if any, that would describe Scott as an investor?

Correct AnswerverifiedShow Answer

Which of the following is true regarding the case opener, the case in which Martha Stewart was charged with insider trading after selling stock in a company based on information that her stockbroker gave her that the CEO of the company and his daughter had just sold all of their company stock?

Correct AnswerverifiedShow Answer

Once an issuer files a registration statement and prospectus, the ______ period begins.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following oversees the purchase and sale of securities?

Correct AnswerverifiedShow Answer

Which of the following describes investment banking firms that purchase securities from the issuing corporation with the intent of selling them to brokerage houses, which then sell them to the public?

Correct AnswerverifiedShow Answer

Which of the following refer to state securities laws?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified