Securities and Exchange Act of 1934

The Securities Exchange Act of 1934 established the SEC to oversee federal securities laws. It regulates secondary market transactions, requiring public companies to register securities with the SEC to ensure transparency and prevent fraud. The Act also governs proxy solicitation, margin requirements, and audit standards to maintain market integrity.

What was the primary purpose of establishing the Securities and Exchange Commission (SEC) under the 1934 Act?

• To oversee corporate mergers

• To manage the stock market

• To administer all federal securities laws

• To regulate the initial issuance of securities

Which aspect of securities does the 1934 Act primarily regulate?

• Initial public offerings

• Banking operations

• Corporate tax filings

• Secondary market transactions

What is the purpose of the registration process with the SEC for publicly held companies?

• To limit the number of shareholders

• To reduce company taxes

• To disclose information to the public

• To increase stock prices

What is the role of proxy solicitation in the context of the 1934 Act?

• To facilitate board elections

• To manage company debts

• To regulate stock prices

• To increase shareholder profits

How does the 1934 Act address the issue of margin requirements?

• By increasing interest rates on loans

• By eliminating margin trading

• By setting rules for purchasing shares on margin

• By prohibiting loans for stock purchases