Refer to Fact Pattern 21-3

question 17

Multiple Choice

Refer to Fact Pattern 21-3. Under the Securities Exchange Act of 1934, Fay is most likely

• A)liable for insider trading.
• B)not liable because Fay did not prevent others from profiting.
• C)not liable because Fay did not misappropriate any information.
• D)not liable because Fay does not work for Eureka!

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Definitions:

Fundamental Attribution Error

A bias in social psychology where people tend to attribute others' actions to their character or personality, while attributing their own behaviors to external factors.

Insider Trading

The illegal activity of trading a public company's stock or other securities by individuals with access to non-public, material information.

Externality

In economics, a cost or benefit resulting from an activity that affects individuals or entities who did not choose to be involved in the situation.

Causal Attributions

involves the process by which individuals assign causes to behaviors and events, affecting how they perceive and react to situations.