In Effect to Protect Customers from Unsubstantiated or Undocumented Losses

question 86

Multiple Choice

In effect to protect customers from unsubstantiated or undocumented losses. NASD has some specific rules. The rules include:

• A) Registered representatives are prohibited from guaranteeing a customer's account against loss or from sharing in the losses or gains in an account.
• B) Private transactions conducted outside the firm are prohibited.
• C) If a firm's stock is publicly traded, employees of the firm may not recommend nor solicit purchases of the firm's stock. However, unsolicited purchases are acceptable.
• D) All of These.

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Definitions:

Price Fixing

An illegal agreement between competitors to fix, control, or maintain the price of goods or services at a certain level, often higher than the free market would set.

Predatory Pricing

A competitive strategy where a company sets very low prices for its products or services with the intent to drive competitors out of the market.

Break-even Analysis

A calculation that determines when a business or project will be able to cover all its expenses and begin to make a profit.

Fixed Costs

Expenses that do not change with the level of production or sales activities within a certain scale, such as rent, salaries, and insurance.