100% CORRECT ANSWERS|LATEST
Section 1: Knowledge of Capital Markets - ANSWER
The SEC
purpose/mission
when created
jurisdiction
authority - ANSWER protect investos, maintin fair orderly & efficient markets,
facilitate capital formation
by congress in 1934
US federal government
enforce federal security laws & create laws that regulate securities industry
enforces Securities act 1933/1934, trust indenture act 1939, investment company act 1940,
investment advisors act 1940
SROs (Self-Regulatory Organizations)
what is the largest SRO? - ANSWER organization formed to regulate certain
professions & industires
to create rules that promote order among businesses& orgs, supplemental to laws/gov
1
,FINRA
CBOE
jurisdiction? - ANSWER originated the VIX
Chicago board options exchange
1st nationally recognized sec exchange listing and trading options.
(lgest option market)
SRO
jurisdiction over all writing and trading of standardized options and related contracts listed
on exchange
FINRA
government? - ANSWER Financial Industry Regulatory Authority
license and regulate B/Ds
license security dealer, audit dealers/associated firms, ensure compliance, write/enforce
rules governing BDs, regulate trading equities corps bonds sec features options
independent NONgovernmental
2
,largest SRO
MSRB
supports? - ANSWER Municipal Securities Rulemaking Board
BOD oversee Us municipal & responsible for setting/governing rules
support FINRA
SRO
Department of Treasury/IRS - ANSWER manage federal finances by collecting taxes
and paying bills & managing currency/gov accs /public debt
IRS- US gov agency responsible for collecting most federal taxes and for administering tax
rules and regulations
State Regulators - ANSWER state/local public service/utilities commission,
insurance/annuity, banking, company info, consumer protection
NASAA
what is it? - ANSWER North American Securities Administrators Association
oldest international investor protection organization
(a state regulator)
The Federal Reserve
fiscal or monetary policy?
composed of?
3
, when tighten policy? - ANSWER the central bank of the United States
control inflation/encourage employment, responsible for clearing checks & supplying
currency, most important to loan $ to other banks & set interest rates, make bank reserve
requirements
independent body (meaning looks after broader interests rather than for ones own political
interests)
lower rate= more money borrowed= more money in circulation
BOG (board of governors), 12 fed reserve banks, fed open market committee (FOMC=set
monetary policy)
when inflation is too high
SIPC
oversees? - ANSWER Securities Investor Protection Corporation
protects customers account in BD bankruptcy cash/securities up to 500,000, cash only
250,000
oversee liquidation of member firms
nonprofit
FDIC
type of agency?
why created?
4
Section 1: Knowledge of Capital Markets - ANSWER
The SEC
purpose/mission
when created
jurisdiction
authority - ANSWER protect investos, maintin fair orderly & efficient markets,
facilitate capital formation
by congress in 1934
US federal government
enforce federal security laws & create laws that regulate securities industry
enforces Securities act 1933/1934, trust indenture act 1939, investment company act 1940,
investment advisors act 1940
SROs (Self-Regulatory Organizations)
what is the largest SRO? - ANSWER organization formed to regulate certain
professions & industires
to create rules that promote order among businesses& orgs, supplemental to laws/gov
1
,FINRA
CBOE
jurisdiction? - ANSWER originated the VIX
Chicago board options exchange
1st nationally recognized sec exchange listing and trading options.
(lgest option market)
SRO
jurisdiction over all writing and trading of standardized options and related contracts listed
on exchange
FINRA
government? - ANSWER Financial Industry Regulatory Authority
license and regulate B/Ds
license security dealer, audit dealers/associated firms, ensure compliance, write/enforce
rules governing BDs, regulate trading equities corps bonds sec features options
independent NONgovernmental
2
,largest SRO
MSRB
supports? - ANSWER Municipal Securities Rulemaking Board
BOD oversee Us municipal & responsible for setting/governing rules
support FINRA
SRO
Department of Treasury/IRS - ANSWER manage federal finances by collecting taxes
and paying bills & managing currency/gov accs /public debt
IRS- US gov agency responsible for collecting most federal taxes and for administering tax
rules and regulations
State Regulators - ANSWER state/local public service/utilities commission,
insurance/annuity, banking, company info, consumer protection
NASAA
what is it? - ANSWER North American Securities Administrators Association
oldest international investor protection organization
(a state regulator)
The Federal Reserve
fiscal or monetary policy?
composed of?
3
, when tighten policy? - ANSWER the central bank of the United States
control inflation/encourage employment, responsible for clearing checks & supplying
currency, most important to loan $ to other banks & set interest rates, make bank reserve
requirements
independent body (meaning looks after broader interests rather than for ones own political
interests)
lower rate= more money borrowed= more money in circulation
BOG (board of governors), 12 fed reserve banks, fed open market committee (FOMC=set
monetary policy)
when inflation is too high
SIPC
oversees? - ANSWER Securities Investor Protection Corporation
protects customers account in BD bankruptcy cash/securities up to 500,000, cash only
250,000
oversee liquidation of member firms
nonprofit
FDIC
type of agency?
why created?
4
