LGS 200 Final Exam Questions With
Correct Answers
The Securities Act of 1933 is a federal statute that primarily regulates
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the issue of securities by companies and other businesses. - CORRECT
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ANSWER✔✔-True
The sale of securities by an issuer to the public is known as an initial
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public offering. (IPO) - CORRECT ANSWER✔✔-True
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The ________ is a federal statute primarily designed to prevent fraud in
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the trading of securities after they are issued, - CORRECT ANSWER✔✔-
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Securities Exchange Act of 1934 | | | |
A(n)____ refers to a document that an issuer of securities files with the
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SEC that contains required information about the issuer, the securities
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to be issued, and other relevant information. - CORRECT ANSWER✔✔-
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registration statement |
A(n)______ is submitted along with the registration statement to the
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SEC, and also used as a selling tool to help prospective investors
| | | | | | | | | | | |
evaluate the financial risk of an investment. - CORRECT ANSWER✔✔-
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prospectus
, Which of the following constitutes insider trading? - CORRECT
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ANSWER✔✔-an employee makes a profit by personally purchasing | | | | | | | |
shares of the corporation prior to public release of favorable
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information;
A(n) _________ is a person who discloses material nonpublic
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information to another person. - CORRECT ANSWER✔✔-tipper
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The __________ imposes liability under Section 10(b) and Rule 10b-5 on
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an outsider who misappropriates information about a company, in
| | | | | | | | | |
violation of his or her fiduciary duty, and then trades in the securities of
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that company. - CORRECT ANSWER✔✔-misappropriation theory
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Which of the following is best defines short-swing profits? - CORRECT
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ANSWER✔✔-profits that are made by a statutory insider on trades | | | | | | | | | |
involving equity securities of their corporation that occur within six
| | | | | | | | | |
months of each other; | | |
Agency law is a mixture of tort and contract law. - CORRECT
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ANSWER✔✔-True
In what ways can an agency and resulting authority of an agent arise? -
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CORRECT ANSWER✔✔-express agency | |
Correct Answers
The Securities Act of 1933 is a federal statute that primarily regulates
| | | | | | | | | | | |
the issue of securities by companies and other businesses. - CORRECT
| | | | | | | | | | |
ANSWER✔✔-True
The sale of securities by an issuer to the public is known as an initial
| | | | | | | | | | | | | | |
public offering. (IPO) - CORRECT ANSWER✔✔-True
| | | | |
The ________ is a federal statute primarily designed to prevent fraud in
| | | | | | | | | | | |
the trading of securities after they are issued, - CORRECT ANSWER✔✔-
| | | | | | | | | |
Securities Exchange Act of 1934 | | | |
A(n)____ refers to a document that an issuer of securities files with the
| | | | | | | | | | | | |
SEC that contains required information about the issuer, the securities
| | | | | | | | | |
to be issued, and other relevant information. - CORRECT ANSWER✔✔-
| | | | | | | | |
registration statement |
A(n)______ is submitted along with the registration statement to the
| | | | | | | | | |
SEC, and also used as a selling tool to help prospective investors
| | | | | | | | | | | |
evaluate the financial risk of an investment. - CORRECT ANSWER✔✔-
| | | | | | | | |
prospectus
, Which of the following constitutes insider trading? - CORRECT
| | | | | | | | |
ANSWER✔✔-an employee makes a profit by personally purchasing | | | | | | | |
shares of the corporation prior to public release of favorable
| | | | | | | | | |
information;
A(n) _________ is a person who discloses material nonpublic
| | | | | | | | |
information to another person. - CORRECT ANSWER✔✔-tipper
| | | | | |
The __________ imposes liability under Section 10(b) and Rule 10b-5 on
| | | | | | | | | |
an outsider who misappropriates information about a company, in
| | | | | | | | | |
violation of his or her fiduciary duty, and then trades in the securities of
| | | | | | | | | | | | | |
that company. - CORRECT ANSWER✔✔-misappropriation theory
| | | | |
Which of the following is best defines short-swing profits? - CORRECT
| | | | | | | | | | |
ANSWER✔✔-profits that are made by a statutory insider on trades | | | | | | | | | |
involving equity securities of their corporation that occur within six
| | | | | | | | | |
months of each other; | | |
Agency law is a mixture of tort and contract law. - CORRECT
| | | | | | | | | | | |
ANSWER✔✔-True
In what ways can an agency and resulting authority of an agent arise? -
| | | | | | | | | | | | | |
CORRECT ANSWER✔✔-express agency | |
