Exercise
Choose the Best Answer
- 1. What is the purpose of a letter of intent?
- A. A letter of intent accompanies the prospectus and explains the terms of sale to potential investors.
- B. A letter of intent allows an investor to place a price-per-share bid on an intended purchase.
- C. A letter of intent allows an investor to pay a sales charge based on a lower breakpoint on sales during a specified period of time.
- D. A letter of intent allows an investor to reserve shares for a future purchase at a specified time when he has the money.
- 2. What is the purpose of rights of accumulation?
- A. Rights of accumulation allow an investor to choose whether to apply accumulation (appreciation) in her account to cash dividends or purchase of new shares.
- B. Rights of accumulation allow an investor to pay a sales charge based on a lower breakpoint calculated by including account accumulation (