16%of Test Knowledge Of Capital Markets

Question 1

What is not an acceptable choice to function as a depository and intermediary for transactions between buyers and sellers of securities?

Answer 1

Credit unions

Question 2

During the cooling off period of a new registration filed with the SEC

Answer 2

A red herring may be given to prospective investors

Question 3

when choosing to issue additional bonds to the general public in order to raise more capital, a corporate issuer is engaging in

Answer 3

A primary offering

Question 4

Which of the following would be the interest rate charged for overnight uncollateralized loans negotiated between two money center banks

Answer 4

Federal funds rate

Question 5

Security regulations that are called blue sky laws refer to those at

Answer 5

The state level

Question 6

Which of the following would be considered an isolated non-issuer transaction exempt from state registration under the uniform securities act

Answer 6

An individual buying stock from another individual without using the services of a registered representative

Question 7

When the Federal open market committee (FOMC) directs that treasury securities be sold in the open market this

Answer 7

Decreases the money supply

Question 8

Regarding registration for the sale of securities, those are registered under the investment company act of 1940 such as mutual funds would be considered

Answer 8

Federal covered securities and not required to register at the state level

Question 9

What is not exempt from the securities act of 1933?

Answer 9

Limited partnerships

Question 10

What is exempt from the securities act of 1933?

Answer 10

US treasury securities

Fixed annuity contracts

Debt securities issued by religious organizations

Question 11

Carrying firms may not

Answer 11

Mix customer funds and securities with their own

Question 12

The economy is showing that employment is low, there is no concern would be manned and loans for expansion and retooling our way down, showing a lack of business activity. Yep prices for consumer goods are still rising. Economists would call this a period of

Answer 12

Stagflation

Question 13

In underwriting group is currently assisting an issue were with the preparation and filing of the registration statement for a new issue who is responsible for the accuracy of the information within the registration statement?

Answer 13

The issuing corporation

Question 14

What is not exempt from the registration requirement of the securities act of 1933

Answer 14

Access equals delivery rule

Question 15

What is exempt from the registration requirement of the securities act of 1933

Answer 15

Regulation A

Regulation D

Rule 147

Question 16

Underwriters who are assisting an issue were in bringing securities to the investing public can do which of the following between the time registration was filed with the SEC and the effective date?

Answer 16

Distribute a preliminary prospectus to the investing public

Question 17

The prime rate is set by who?

Answer 17

Individual banks

Question 18

Regarding the purchase of new equity issues (IPOs) Restricted persons may

Answer 18

Not purchase shares of a new issue

Question 19

A weak US dollar leads to more

Answer 19

US exports and a balance of payments surplus

Question 20

It is expected that financial markets

Answer 20

Have transparent pricing for assets

Question 21

US consumers are increasing their imports of foreign-made goods. On this data alone one might expect gross domestic product (GDP) to

Answer 21

Decrease

Question 22

Municipalities the federal government and corporations can raise funds in the capital markets. True or false?

Answer 22

True

Question 23

This offering is most likely exempt from the registration requirement of the securities act of 1933

Answer 23

Private or non-public securities offerings

Question 24

If the large money center commercial banks begin to lower their prime rates which of the following occurs

Answer 24

Smaller banks will lower lending rates for credit where the corporate customers as well

Question 25

Economists call mild short term contractions

Answer 25

Recessions

Question 26

And official statement is a disclosure document that would be used in connection with an offering of which of the following securities

Answer 26

Municipal bonds

Question 27

The statement these securities I have not been approved or disapproved nor have any representations been made about the accuracy or the adequacy of the information is

Answer 27

Mandated to be in the final prospectus by the SEC

Question 28

Access equals delivery can only mean

Answer 28

Physical delivery of the prospectus and not viewing one on a website

Question 29

When the supply for money exceeds the demand

Answer 29

Interest rates fall, making consumer borrowing easier

Question 30

A preliminary prospectus or red herring

Answer 30

Maybe used to gather indications of interest

Question 31

When the demand for money exceeds the supply

Answer 31

Interest rates rise, making consumer borrowing more difficult

Question 32

Shelf offerings are covered under

Answer 32

The securities act of 1933

Question 33

A toy company is experiencing sudden strong demand for a game. Purchasing this company stock may prove profitable in the short run. This company‘s stock might best be termed as a

Answer 33

Special situation

Question 34

Mild inflation can encourage what with the economy?

Answer 34

Growth and stimulate the economy

Question 35

The federal laws requiring companies offering public equity or debt securities to provide a prospectus to investors is known as

Answer 35

The securities act of 1933

Question 36

The FRB or Federal reserve board does not

Answer 36

Enact fiscal policy

The president does this

Question 37

To prevent inflation by tightening the available credit, the FRB would NOT do what?

Answer 37

Lower the prime rate

Question 38

Which of the following benchmark interest rates is considered a barometer of the direction of short term interest rates

Answer 38

The federal funds rate

Question 39

True or false, issuer transactions occur in the primary market, and securities are offered at a public offering price

Answer 39

TRUE