Future Business Leaders of America (FBLA) Securities and Investments Practice Test

What document is required to be submitted to the SEC under the Securities Act of 1933?

1. A preliminary prospectus without a price

2. A registration statement disclosing material information

3. A summary of the company's business model

4. A trading history report of the company's securities

The correct answer is: A registration statement disclosing material information

The requirement to submit a registration statement disclosing material information under the Securities Act of 1933 is fundamental to ensuring transparency in the securities offerings. This regulation was established to protect investors by requiring companies to provide detailed information about their business, financial condition, and the risks associated with investing in their securities. A registration statement must contain comprehensive information, including the company's financial statements, management biographies, and the specific details of the securities being offered. This document allows potential investors to make informed decisions based on the complete and accurate depiction of the company's circumstances. By mandating the inclusion of material information, the Act also aims to prevent fraud and misrepresentation in the sale of securities, which is critical for maintaining trust within the capital markets. This requirement reinforces the importance of regulatory oversight in the investment process, ensuring that the information provided to investors is as complete and truthful as possible.