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abruzzese [7]
3 years ago
8

"A registered representative is a 15% participant in an investment club formed by members of the local Elks Club. The Elks Club

investment club has opened a securities account at ABC Brokerage. The account wishes to buy an IPO being offered by an underwriter. Which statement is TRUE?"
Business
1 answer:
Alex787 [66]3 years ago
6 0

Answer: D. The account is prohibited from buying the new issue

Explanation:

The options to the question are:

A. The account can buy the issue without restriction

B. The account can buy the issue if the branch manager approves

C. The account can buy the issue if the registered representative agrees not to share in the profit on the position

D. The account is prohibited from buying the new issue.

From the question, we are informed that a registered representative is a 15% participant in an investment club formed by members of the local Elks Club and that the Elks Club investment club has opened a securities account at ABC Brokerage.

We are further told that the account wishes to buy an IPO being offered by an underwriter, out of the options that were given, the correct option is that account is prohibited from buying the new issue.

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