Which statement regarding the underwriting process and over-the-counter (OTC) markets is CORRECT?

• A.Many new stock issues that are underwritten by securities firms are first listed on a stock exchange before they are sold over-the-counter.
• B.Corporations must have their shares listed both on an exchange and the OTC market during the underwriting process.
• C.The disclosure standards for stock exchanges are not as stringent as those imposed by the OTC market.
• D.During the underwriting process investment bankers raise investment capital from investors on behalf of corporations and governments issuing securities.

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Maxine is a portfolio manager who 15 years ago, purchased 100 shares of Never2Tacky, a social media corporation for Aspirations Global Technology Fund. She purchased the stock when it was trading at $10. Last year, the peak market price was $120. Presently, it is trading at $99. News agencies are now reporting that additional regulations regarding social media companies are about to be agreed upon by G7 countries. Maxine is concerned the market value of Never2Tacky is going to drop. She buys a put option with an exercise price of $95 with an expiry of 9 months.
What type of strategy is Maxine using?

• A.Speculating
• B.Modern portfolio theory
• C.Passively managing
• D.Hedging

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Solomon is a Dealing Representative who is excited about a new equity fund his dealer recently approved. He thinks investors will be attracted to the fund's historical performance. He has a prospective new client, Madira, who is 25 years old. Madira has invested in mutual funds before, but not with Solomon's dealer. She has made an appointment to open a new RRSP with Solomon's firm.
What does Solomon need to do to make this a suitable recommendation?

• A.Show from past fund performance, that mutual fund costs are not important if there are high returns.
• B.Rely on the risk rating of the mutual fund when offering an investment solution.
• C.Identify how the proposed investment is in alignment with the investor's profile and holdings.
• D.Match the past rates of return of the mutual fund with what is the anticipated rate of return.

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Pacari is a Dealing Representative with Cavalry Investments, a mutual fund dealer. Pacari's client, Darsha, is a long-time customer and an elderly widow. Darsha depended on her husband, for financial decisions before he passed. Pacari has also noticed that Darsha's capacity seems to be declining over the years. Luckily, with Pacari's help, Darsha has been managing her finances well. However, Darsha's daughter has been getting involved recently and has even tried to enter trades without Darsha's authorization. Pacari is particularly concerned about the last transaction for Darsha's account: a very large redemption. Pacari fears that Darsha has become a victim of financial exploitation and he raises his concerns with his dealer Cavalry. Which of the following statements about how Cavalry may proceed is CORRECT?

• A.Cavalry must place a temporary hold on Darsha's account to disallow all transactions for the account.
• B.Cavalry can place a temporary hold on Darsha's account to temporarily disallow the redemption.
• C.Cavalry must proceed with the redemption because temporary and permanent holds are not permitted.
• D.Cavalry can place a permanent hold on Darsha's account and disallow all future transactions.

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Which of the following statements is TRUE about the movement of business cycles in the Canadian economy?

• A.A period of economic expansion is always of the same length as a period of economic contraction.
• B.A period of economic expansion is of the same length in every cycle.
• C.A period of at least 3 consecutive months of contraction is called a recession.
• D.A period of economic expansion is followed by a period of economic contraction.

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