Which of the following scenarios best illustrates the difference between a permissible soft dollar arrangement and an impermissible hard dollar payment?

1. ABroker pays for a research report given to all clients (soft dollar) vs. broker pays client's rent (hard dollar)✓ Correct answer
2. BBroker provides lunch during a seminar (soft dollar) vs. broker covers client's travel expenses to that seminar (hard dollar)
3. CBroker reimburses for professional license fees (soft dollar) vs. broker pays for client’s vacation (hard dollar)
4. DBroker covers a subscription to a portfolio analytics tool (soft dollar) vs. broker waives account maintenance fees (hard dollar)

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