When a Securities Professional Buys Stock for Her Own Account

question 84

Multiple Choice

When a securities professional buys stock for her own account, then urges investors to buy the same stock so that the price will rise, and benefit her, has engaged in:

• A) kiting
• B) churning
• C) dealing
• D) schmoozing
• E) none of the other choices

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Definitions:

Egocentrism

A cognitive bias where individuals overemphasize their own perspective and cannot easily understand or assume the viewpoint of others.

Groups Benefit

Advantages or positive outcomes resulting from individuals coming together to form a collective or team, such as increased creativity, resource sharing, and support.

Cooperative Option

An alternative in decision-making that emphasizes collaboration and mutual benefit, rather than competition or conflict.

Social Dilemma

A situation in which individual rationality leads to collective irrationality, often resulting in negative outcomes for all participants.