This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 7, Series 52, Series 62, Series 65, Series 79, and Series 82):
All of the following is true of the Securities Act of 1933 except?
Answers:
A. One of its purpose is to prohibit fraud and deceit in the marketing of securities
B. It requires that all securities are registered with the federal government prior to offering them for sale
C. The Act requires that a company’s financial statements are certified by independent accountants
D. It regulates how securities are issued and first sold to the public
Correct Answer: B. It requires that all securities are registered with the federal government prior to offering them for sale
Rationale: The Securities Exchange Act of 1933 has two main purposes: (1) to require that companies publicly disclose all relevant financial information about their securities prior to offering them for sale, and (2) to prohibit fraud and deceit in the marketing of securities. The Act requires that most securities be registered with the
federal government prior to their sale, but there are securities that are exempt from registration. The Act regulates how securities are issued and first sold to the public.
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