15. Metal Mining Corporation is a noninvestment company that wants to issue stock of $3 million in a twelve-month period. Metal Mining, with less than $20 million in annual sales, qualifies as a small business issuer. Before Metal Mining sells the stock, it must provide investors with a. an offering circular. b. a notice of the issue. c. a red herring prospectus. d. a tombstone ad

16.Linfield Retail Stores Corporation is a public company with a market capitalization of less than $75 million. Linfield is poised to issue securities in a transaction that, under the Securities Act of 1933, is "exempt." This enables Linfield to

a.reduce the compliance costs by not requiring an auditor report.

b.buy and sell the securities without liability for "recaptures."

c.make forward-looking financial forecasts without liability.

d.withhold inside information from accredited investors.

17.As part of a stock offering for Stakemark Realty, the firm's accountant Edward intentionally misrepresents material facts in the prospectus. Frankie buys the stock unaware of the misrepresentation and suffers a loss. Edward may be subject to

a.a fine and damages only.

b.a fine and imprisonment only.

c.a fine, imprisonment, and damages.

d.damages only

18.Marcmen Manufacturing Inc. files a registration statement with the SEC before making an offering to the general public. The registration contains false, immaterial statements of which the investors are unaware. Marcmen is charged with violating the Securities Act of 1933. Marcmen's best defense is

a.the investors were not aware of the misrepresentations.

b.the issuer reasonably believed the misstatements were true.

c.the offering was made available to the general public.

d.the untrue statements were not material.

19.Lords and Ladies Garment Company has assets of less than $10 million and fewer than fifty shareholders. Bandy Bakeries, Inc., has assets of more than $50 million and more than five hundred shareholders. The Securities Exchange Act of 1934 applies to

a.Lords and Ladies, and Bandy Bakeries

b.Lords and Ladies only.

c.Bandy Bakeries only.

d.neither Lords and Ladies or Bandy Bakeries

20.Lamps and Lights Corporation, and its officers, directors, and shareholders, buy and sell securities. SEC Rule 10b-5 applies to the purchase or sale of

a.a security by a financial corporation only.

b.a security involving a corporate insider only.

c.a security involving short-swing profits only.

d.any security.