Exam 2: Securities Markets and Transactions

Jessica purchased 200 shares of stock at $38 using her 70% margin account.Her maintenance margin is 40%.Jessica has no other securities in her account.At what price will she receive a margin call?

Capital markets deal exclusively in stock.Money markets deal exclusively in debt instruments.

Jocelyn sells short 1000 shares of JKLO stock at $31.25 per share and six months later purchases the shares at $29.00 each.Ignoring margin interest and brokerage fees, Nancy will

After hours markets tend to be less volatile and more liquid than the regular trading sessions.

Which of the following acts abolished fixed commission schedules?

Margin trading will magnify losses on a percentage basis.

Michael purchased 1000 shares of stock at a price of $16 a share.He utilized his 50% margin account to make the purchase.What is Michael's initial equity in this investment?

Underwriters are responsible for promoting and facilitating the sale of securities.

IPOs are relatively safe investments.

The income paid to a market maker is referred to as the spread.

Which one of the following is a major advantage of margin trading?

IPOs are typically underpriced so that the price rises during the first few days of trading.

ECNs are

Which of the following can be encountered when investing in foreign markets? I.foreign taxation of dividends II.different accounting standards for financial disclosure III.restrictions on types of investments IV.illiquid markets