By 2012, there were approximately ________ securities firms and investment banks operating.
A. 9,100
B. 7,600
C. 1,200
D. 480
E. 220 - -D
-The
... [Show More] most common benchmark of relative size of a firm in the securities trading and underwriting industry is based on
A. total asset value.
B. total equity.
C. total debt.
D. annual sales.
E. annual profits. - -B
-Which of the following differentiates securities firms from investment banks?
A. Securities firms are concerned with the commercial side of the business while investment banks are concerned with the retail side of the business.
B. Securities firms assist in trading of existing securities while investment banks specialize in underwriting new securities.
C. Securities firms underwrite new issues of securities while investment banks provide brokerage services.
D. Securities firms originate new issues of securities and investment banks underwrite the securities.
E. Securities firms are concerned with private placements of securities whereas investment banks are
concerned with publicly traded securities. - -B
-Which of the following would be a key area of activity for an investment bank specializing in the commercial side of the business?
A. Purchase of existing securities.
B. Sale of securities in the secondary market.
C. Brokerage of existing securities.
D. Underwriting issues of new securities.
E. All of the above. - -D
-Which of the following is true?
A. Investment bankers earn fees based on the success of their placements when they underwrite using a best-efforts basis.
B. Investment bankers earn fees based on the success of their placement when they underwrite using firm-commitment basis.
C. With best-efforts underwriting, investment bankers act as principals because they purchase securities from the issuer and sell them at a higher price.
D. An investment banker is acting as an agent when conducting a firm-commitment offering of securities.
E. Answers B and C only. - -A
-Discount brokers
A. are securities firms focused on providing research support for customers.
B. conduct trades for customers but do not offer investment advice.
C. allow customers to receive investment advice at very low rates.
D. effect trades for customers on- or offline while offering investment advice.
E. are electronic trading securities firms that allow customers to trade without the use of a broker. - -B
-Which of the following is most typical of broker-dealers?
A. They assist in underwriting of new securities.
B. They assist in trading of existing securities.
C. They assist in issuing new securities.
D. They assist in underwriting and distribution of new securities.
E. All of the above. - -B
-Which of the following is true of private placement of securities?
A. Securities are placed with few large institutional investors.
B. Securities of private firms are sold to the investing public at lower prices. [Show Less]