Canadian Securities Course (CSC) Level 1 Practice Exam

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What are some examples of unethical practices?

Transparency in pricing
Providing accurate market information
High-pressure sales tactics
Market research and analysis

The correct answer is: High-pressure sales tactics

High-pressure sales tactics are considered unethical practices because they can manipulate or coerce potential clients into making hurried investment decisions without fully understanding the products or services being offered. This behavior can lead to clients being misled or making choices that do not align with their best interests or financial goals. The core issue lies in prioritizing the salesperson's immediate financial gain over the client's well-being and informed decision-making. In contrast, transparency in pricing and providing accurate market information promote ethical practices by ensuring that clients receive clear and truthful insights regarding costs and the nature of investment opportunities. Market research and analysis also contribute positively, as they enable informed guidance based on data rather than pressure. These practices are essential for fostering trust and integrity in financial transactions and client relationships.