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NEW QUESTION: 1
Which two statements are true about precedence values in policy? (Choose two.)
A. A higher number is preferred.
B. 1 is the default precedence.
C. 100 is the default precedence.
D. A lower number is preferred.
Answer: C,D

NEW QUESTION: 2
Mr L Ranger is an agent for a broker-dealer and has overheard "talk" that a merger between two well- known high-tech companies is about to take place. Mr. Ranger knows that, on average, in these instances the target firm's price spikes. He calls his client and good friend, Mr Tonto, and tells him of the rumor, suggesting that Tonto might want to buy shares in the target firm. He tells Mr Tonto that if the rumor isn't true, the target firm's price may not spike at all and may, in fact, decline, and suggests that Mr Tonto not invest any money he isn't willing to lose. Mr. Ranger knows that his friend likes to gamble, and decided he wouldn't be much of a friend if he didn't inform Tonto of this potential opportunity.
Has Mr L Ranger violated any laws or engaged in any prohibited practices?
A. Yes Mr Ranger is privy to knowledge that is not available to the general public and both he and Mr Tonto will be guilty of illegal insider trading if Mr Tonto trades on Mr Ranger's information.
B. No Mr Ranger and Mr Tonto are friends, so there can be no violations of any laws or practices because of their non-business relationship.
C. Yes Mr Ranger has engaged in fraud in telling Mr. Tonto about the rumor, given that the merger hasn't been officially announced by the two companies.
D. No Mr Ranger has informed Mr. Tonto that the merger is just a rumor and has informed him of the risk involved Mr Ranger is knowledgeable about his friend's risk tolerance level as well and recognizes this investment as one his good friend might want to take.
Answer: D
Explanation:
Explanation/Reference:
Explanation: No, Mr Ranger has not violated any laws or engaged in any prohibited practices in his recommendation to Mr Tonto. He has simply informed Mr. Tonto of the rumor and has told him of the risk involved, and he has not lied or misled Mr. Tonto about the investment. He is also well aware of his friend's risk tolerance level, so he is not making an unsuitable recommendation. This is not considered insider trading since there is no way Mr. Ranger can know whether or not the rumor is true. Selection A is not true because there can be violations of laws or practices, even if the agent and client are friends.

NEW QUESTION: 3
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A. true
B. false
Answer: A

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