The Securities and Exchange Commission (SEC) Was Established In1934 to Help

question 28

Multiple Choice

The Securities and Exchange Commission (SEC) was established in1934 to help regulate the U.S. securities market. Which of the following statements is true concerning the SEC?

• A) The SEC prohibits the sale of speculative securities.
• B) The SEC regulates only securities offered for public sale.
• C) Registration with the SEC guarantees the accuracy of the registrant's prospectus.
• D) The SEC's initial influence and authority has diminished in recent years as the stock exchanges have become more organized and better able to police themselves.

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs, representing the portion of sales that contributes to covering fixed costs.

Production Constraint

A limit to the amount or volume of production, often caused by the availability of resources, technology, or market demand.

Machine Hours

A measure of the amount of time a machine is operated in the production process.

Avoidable Costs

Avoidable Costs are expenses that can be eliminated if a particular decision is made, such as discontinuing a product or service.