Dewayne has learned about a new security being issued and is consideri

QUESTION

Dewayne has learned about a new security being issued and is considering investing in it. Before making a decision, he is reviewing a document from his broker that describes the security. What is Dewayne reviewing?

A) stock certificate
B) Treasury bill
C) certificate of deposit
D) prospectus
E) bond coupon

ANSWER

Answer: D
Explanation: D) A prospectus is a detailed written description of a new security. All publicly traded companies and securities brokers and dealers are required to provide interested investors with a prospectus—even if an investor wants to buy the security immediately.