Series 63 practice questionmediumExempt Securities - Nonprofit Securities (Scenario)
A religious organization in State Z issues bonds to fund construction of a new church. Under the USA, these bonds are:
- AExempt securities because they are issued by a nonprofit✓ Correct answer
- BNot exempt and must be registered with the state
- CExempt only if sold to accredited investors
- DExempt only if listed on a national exchange
Explanation
Why A — Exempt securities because they are issued by a nonprofit
Nonprofit organizations, including religious groups, are covered by the exemption in USA Section 402(a)(5). The exemption does not depend on investor type or exchange listing.
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