The Provisions of Section 17(a) of the 1933 Act

question 70

Multiple Choice

The provisions of Section 17(a) of the 1933 Act:

• A) primarily allow for a private right of action for persons injured by the act.
• B) make it unlawful to engage in any transaction, practice, or course of business that operates as deceit upon the issuer.
• C) make it unlawful in the offer or sale of any securities to obtain property by any statement that omits a material fact without which the information is misleading.
• D) None of these.

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Definitions:

IRR

Internal Rate of Return; a financial metric used to estimate the profitability of potential investments.

Cost of Capital

The rate of return a firm needs to generate on its investment initiatives to preserve its market value and appeal to investors.

Cash Flows

The combined total of cash inflows and outflows in a company, significantly impacting its liquid assets.

NPV

Net Present Value (NPV) is a financial metric that calculates the difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment.