Which of the Following Is True of Rule 10b-5 of the 1934

question 6

Multiple Choice

Which of the following is true of Rule 10b-5 of the 1934 Act?

• A) Securities need not be registered under the 1933 Act or the 1934 Act for Rule 10b-5 to apply.
• B) The rule applies only to transactions executed on a securities exchange.
• C) The rule applies only to face-to-face transactions.
• D) Misstatements or omissions of material fact, scienter, and reliance are not elements of Rule 10b-5.

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Definitions:

Break-even Level

The juncture where overall expenses match the total income, leading to neither a net profit nor a loss.

M&M Theory

Modigliani and Miller's theory positing that in an ideal market, a company's value is unaffected by how it is financed, whether through debt or equity.

Capital Structure

The mix of a company's long-term debt, specific short-term debt, common equity, and preferred equity which funds its overall operations and growth.

Total Cash Flows

The total sum of cash and cash-equivalents moving into and out of a company.