Identify Whether the Following Statements Could Result in Actionable Fraud

question 53

Essay

Identify whether the following statements could result in actionable fraud and why or why not.
a. A statement by an art dealer to a potential buyer, "I think this painting is underpriced because the artist is now gaining national recognition."
b. A vacuum cleaner salesperson's statement, "This machine is the best available for the cost."
c. A city councilman's statement to a fellow councilman that, "If we vote for that action, the resulting consolidation will be illegal."

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Definitions:

Dividend Increase

A rise in the amount of money paid to shareholders out of a company's earnings per share.

Annual Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits on a yearly basis.

Dividends Increase

An action by a company to increase the amount of dividends paid to shareholders, typically signaling confidence in the company's profitability.

Rate of Return

The success or failure of an investment over a determined timeframe, depicted as a percentage of the investment’s original stake.