[Camping Profits] Eva Is the Vice President at Big Chain

question 57

Multiple Choice

[Camping profits] Eva is the vice president at Big Chain Camping Goods Store. She learns that the company is soon going to purchase a smaller chain of stores. It is expected that stock in Big Chain Camping Goods will rise dramatically at that point. Eva immediately buys a number of shares of her company's stock. She also tells her friend Claire about the expected purchase of stores. Claire wants to purchase stock in the company but lacks the funds with which to do so. Although she did not have the funds in Bank A, Claire decides to draw a check on Bank A and deposit the check in Bank B and then proceeds to write a check on Bank B to cover the purchase of the stock. Claire hopes that she would have sufficient funds to deposit before the check is presented for payment.
-By providing information to Claire regarding the purchase, Eva is guilty of which offense, if any?

• A) She is guilty of an insider-trading violation by tipping the information.
• B) She is guilty of an insider-trading violation by being tipped.
• C) She is guilty of an insider-trading violation by both tipping and being tipped.
• D) She is guilty of criminal extortion.
• E) She is not guilty of any offense.

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Definitions:

Closing Prices

The final price at which a security is traded on a given trading day, used for record-keeping and performance evaluation.

Decrease Percentage

The rate at which a quantity diminishes in comparison to its original value.

Sole Proprietorship

A business that is owned by one person.

Public Corporation

A corporation where any person can purchase a share of stock in the corporation.