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AWMA MODULE 8 QUIZ
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AWMA MODULE 8 QUIZThe principle that certain mutual fund policies cannot be amended without
shareholder agreement is addressed in the
A) The Investment Companies Act of 1940.
B) The Securities Exchange Act of 1934.
C) The Investment Advisers Act of 1940.
D) The Securities Act of 1933. - ANSWER A: Investment Company Act of 1940.
Mutual funds are regulated by the Investment Company Act of 1940.
FINRA's primary responsibility is
A) Establishing rules and regulations for its members.
B) setting guidelines for issuing new securities in the primary market.
C) guaranteeing customer accounts if brokerage businesses are liquidated.
D) Registering broker-dealer agents to conduct business with the general public. -
ANSWER A) creates rules and regulations for its members.
FINRA is the largest securities industry self-regulatory body, therefore it develops
rules and regulations for its members.
Regulatory and industry actions involving fiduciary advice supplied by investment
advisers, and the implementation of Regulation Best Interest are most probable
A)
Reduce client expectations of brokers and advisers, and costs will remain relatively
stable.
,B)
Increase clients' expectations of brokers and advisers while putting downward
pressure on fees.
C)
have little impact on clients' expectations of brokers and advisers, as well as any
costs levied.
D)
Increased client expectations will most likely result in increased costs being
charged. - ANSWER B
Increase clients' expectations of brokers and advisers while putting downward
pressure on fees.
The bar is being raised as the public becomes more aware of the distinctions
between fiduciary and nonfiduciary counsel. Regulation Best Interest has raised the
bar for brokers and increased their expectations. The SEC has recently issued
advice on the fiduciary responsibility that advisers owe their customers. These
innovations will raise client expectations of brokers and advisors, putting
downward pressure on fees and the sale of certain products, particularly
sophisticated high-fee products, which are now discouraged.
Which statute lifted the limitation on financial institutions offering a combination
of commercial banking, investment banking, and insurance services?
A)
Gramm-Leach-Bliley Act, 1999
B)
US Patriot Act of 2001
C)
, Commodity Futures Modernization Act, 2000
D)
Securities Act Amendments of 1975 - ANSWER A)
Gramm-Leach-Bliley Act, 1999
The Gramm-Leach-Bliley Act of 1999, commonly known as the Financial Services
Modernization Act, abolished a provision of Glass Steagall that had previously
banned financial organizations from combining and offering commercial banking,
investment banking, and insurance services.
The Employee Retirement Income Security Act (ERISA) was primarily passed out
of concern for the integrity and safety of
A)
Employer-sponsored retirement programs.
B)
Employee pay and benefits.
C)
Employees' working circumstances.
D)
Employer-provided insurance benefits. - Answer A).
Employer-sponsored retirement programs.
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