Multiple Choice
How does the finance function relate to company spending in the context of investments in securities?
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7. Receivables and Investments
Introduction to Investments in Securities
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Who is primarily responsible for regulating markets where investments in securities are traded in the United States?
A
Securities and Exchange Commission (SEC)
B
Financial Accounting Standards Board (FASB)
C
Federal Reserve Bank
D
Internal Revenue Service (IRS)
Verified step by step guidance1
Understand the context of the question: It is asking about the regulatory body responsible for overseeing markets where securities are traded in the United States. This involves knowledge of financial regulations and institutions.
Review the roles of the listed entities: The Securities and Exchange Commission (SEC), Financial Accounting Standards Board (FASB), Federal Reserve Bank, and Internal Revenue Service (IRS). Each has distinct responsibilities in the financial system.
Focus on the SEC: The SEC is primarily responsible for regulating securities markets, ensuring transparency, protecting investors, and maintaining fair and efficient markets.
Clarify the role of the other entities: The FASB establishes accounting standards (GAAP), the Federal Reserve Bank manages monetary policy and banking systems, and the IRS oversees tax collection and enforcement.
Conclude that the SEC is the correct answer based on its specific mandate to regulate securities markets in the United States.
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