Fact Pattern Fresh Fruits & Veggies,Inc. ,Wants to Make an Initial Public

question 36

Multiple Choice

Fact Pattern
Fresh Fruits & Veggies,Inc. ,wants to make an initial public offering of securities.Fresh believes that it qualifies for an exemption under Regulation A from the full registration requirement of the federal Securities Act of 1933.
-Refer to Fact Pattern 29-1A.Fresh decides to sell its new securities via the Internet.This offering

• A)will avoid the payment of commissions to brokers or underwriters.
• B)is an investment scam.
• C)is a Ponzi scheme.
• D)constitutes insider trading.

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Definitions:

Primacy Effect

The tendency to remember information at the beginning of a list better than information in the middle or end.

Horn Effect

A cognitive bias causing negative traits or experiences with an individual to influence overall perception of them disproportionally.

Recency Effect

is the cognitive phenomenon where the most recently presented items or experiences are more likely to be remembered than those presented earlier.