Exercise
Answer the following questions.
- 1. The federal legislation that requires issuers of securities to register the securities and provide full disclosure to investors is the:
- A. Securities Exchange Act of 1934
- B. Uniform Securities Act of 1956
- C. Securities Act of 1933
- D. Investment Company Act of 1940
- 2. What doesn’t happen to a customer’s account upon her death?
- A. The account is frozen
- B. All positions are liquidated
- C. All open orders are cancelled
- D. All powers of attorney are cancelled
- 3. The disclosure document that municipal bond issuers offer to prospective investors is called a/n:
- A. Prospectus
- B. Trust indenture
- C. Legal opinion
- D. Official statement
- 4. Terry Johnson just discovered that his broker-dealer put a 90-day freeze on his account because he bought and sold common stock before paying for the shares in a cash account. This means that he:
- A. Cannot purchase securities until the freeze is lifted
- B. Can purchase securities and pay for them by the settlement date
- C. Can purchase securities provided he pays for them on the date of the trade
- D. Cannot purchase securities for 10 business days
Answers
- 1. C. The Securities Act of 1933, often referred to as the “Paper Act,” was the first U.S. law to require issuers of stocks to register them