Investments Test Review

Front

What is the primary characteristics of an option contract?

Back

It derives its value from an underlying security or asset

Front

For a call option to be considered "in the money", what must be true?

Back

Market price must be above strike price

Front

Which type of option exercise style allows the holder to exercise at any time before expiration?

Back

American style

Front

The Options Clearing Corporation (OCC) serves what primary function? Options: Sets option strike prices, Determines expiration dates, Guarantees all listed options

Back

Guarantees all listed options

Front

Which Federal agency is responsible for protecting investors, maintaining fair markets, and facilitating capital formation?

Back

SEC

Front

The Securities Act of 1933 primarily focuses on

Back

Primary market regulation

Front

The maximum criminal penalty for insider trading can include: 10 years imprisonment, $5 million fine and/or 20 years imprisonment, $1 million fine only.

Back

$5 million fine and/or 20 years imprisonment

Front

What is treasury stock?

Back

Stock repurchased by the corporation

Front

What is the primary characteristics of blue-chip stocks?

Back

Long record of stable earnings

Front

Which type of preferred stock requires missed dividends to be paid before common stockholders receive any dividends?

Back

Cumulative preferred