Final answer:
The notification during the restricted period in underwriting is to prohibit certain trading activities, ensuring fair and orderly market updates, in compliance with the Federal Securities Act, enforced by the SEC.
Step-by-step explanation:
The purpose of the notification during the restricted period in underwriting is D) To prohibit certain trading activities related to the securities being offered. This restricted period, often referred to as the "quiet period," is a time before the offering when underwriters and the company preparing to go public are limited in what they can say publicly about the stock to prevent influencing the market. This prohibition of specific actions ensures a fair and orderly market update process and adheres to legal standards established by the Federal Securities Act and enforced by the Securities and Exchange Commission (SEC). This period helps to ensure that all investors have equal access to material information and are not misled by promotional hype that could artificially inflate or deflate the value of the securities being offered.