QUESTION 4

1. Bernie Madoff created a Ponzi Scheme by:

   		bribing the U.S. Securities & Exchange Commission with $50 billion.
   		taking investors' money, but keeping the money for himself. He paid returns to old investors with money from new investors.
   		taking investors' money and buying stocks for them. If the stocks did not do well, he paid off old investors with money from new investors.
   		promising a steady return of 1 to 2% per month and then investing wisely to be able to make good on that promise.

1 points

QUESTION 5

1. Companies X and Y are competing for a major government contract that would secure the future of either company. Stock prices for Y are rising and stock prices for X are falling. Assuming the efficient market hypothesis holds, you should infer that:

   		X is more likely to land the contract.
   		There isn't enough information to make an educated prediction.
   		X and y are equally likely to land the contract.
   		Y is more likely to land the contract.

1 points

QUESTION 6

1. A ________ trades for its own account; a_______ trades on behalf of clients.

   		mortgage lender; property owner
   		broker; dealer
   		property owner; mortgage lender
   		dealer; broker