Why Is Insider Trading Problematic

question 39

Multiple Choice

Why is insider trading problematic?

• A)If insiders trade on their information,they cause unnecessary share price fluctuations that drive away outside investors.
• B)If insiders trade on their information,the firm is automatically fined and there will be a net loss in firm value.
• C)If insiders trade on their information,outside investors will benefit from the increase in the share price and thus there is a free rider problem.
• D)If insiders trade on their information,it increases the conflicts between shareholders and managers.
• E)If insiders trade on their information,their profits come at the expense of outside investors,making outside investors less willing to invest in corporations.

Understand the role and effectiveness of deliberate and automatic systems in achieving goals.

Grasp the concept of self-regulation and its importance in adapting to various circumstances.

Comprehend the accuracy of self-evaluation in goal setting.

Explain the cognitive evolution and functionality in decision making and behavior facilitation.

---

Definitions:

Job Satisfaction

The level of contentment individuals feel with their job, including aspects like work environment, salary, and tasks.

Frustrated

The feeling of being upset or annoyed as a result of being unable to change or achieve something.

Valued

Considered to be important, beneficial, or of significant worth to an individual or group.

Counterproductive Work Behaviors

Conduct by staff members that negatively impacts the organization's health or that of its associates.