The Use of Material, Nonpublic, Financial Information to Obtain an Unfair

question 39

Multiple Choice

The use of material, nonpublic, financial information to obtain an unfair advantage is trading securities is called _____________.

• A) churning
• B) insider trading
• C) stock manipulation
• D) fraud

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Definitions:

Total Capital

The sum of a company's equity, debt, and any other long-term financing.

Admission by Investment

The process of becoming a partner or member in a company or partnership through a financial investment.

Capital Balance

The amount of money in a company's equity account, not including profits or losses.

Interest

The fee paid for borrowing money, typically expressed as an annual percentage of the principal.