________Is the Purchase or Sale of the Stock of a Publicly

question 110

Multiple Choice

________is the purchase or sale of the stock of a publicly listed corporation based on information that is not available to the general public about the plans or financial status of the corporation.

• A) Sale of securities
• B) Insider trading
• C) Inside information
• D) Securitization

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Definitions:

Implicit Costs

The opportunity costs of using resources owned by the firm for its own operations, without direct payment but with foregone opportunities.

Explicit Costs

Direct, out-of-pocket payments for wages, rent, and materials, among others, involved in the production of goods or services.

Opportunity Costs

The cost of forgoing the next best alternative when making a decision or choice.

Implicit Costs

Indirect, non-out-of-pocket expenses which represent the opportunity costs of using resources owned by the firm for its operations.