As a Result of the Alleged Conflicts of Interest Between

question 39

Multiple Choice

As a result of the alleged conflicts of interest between analysts and underwriting,which of the following changes were implemented?
I. Analysts cannot participate in nor attend certain presentations to potential investors conducted by investment bankers associated with underwriting an issue.
II. Analyst compensation can no longer be tied to the amount of underwriting business a firm generates.
III. Securities firms must divest stock research divisions to ensure independence from their investment banking business.

• A)I only
• B)I and II only
• C)I and III only
• D)II and III only
• E)I,II,and III

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Definitions:

Short-Run

A period during which at least one of a firm's inputs is fixed, limiting its ability to adjust to demand changes.

AVC

Average Variable Cost, which is the total variable costs of production divided by the quantity of output.

Short Run

A period in which at least one of a firm's inputs is fixed and cannot be varied.

Variable Costs

Expenses that directly fluctuate in accordance with the amount of production or output.