Which of the Following Constitutes Insider Trading

question 29

Multiple Choice

Which of the following constitutes insider trading?

• A) an employee makes a profit by personally purchasing shares of the corporation prior to public release of favorable information
• B) a manager purchases all shares of a corporation available to the public
• C) a director purchases enough shares of a public company to gain a majority stake in its management
• D) an employee sells his shares of the company to another employee without notice to the company

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Definitions:

Intrinsic

Referring to motivation or behavior that is driven by internal rewards or satisfactions rather than external factors.

Great Pleasure

An intense feeling of deep satisfaction, joy, or delight.

Intrinsically Motivated

Refers to being motivated by internal factors, such as personal satisfaction or the joy of doing something, rather than by external rewards.

Extrinsic Motivation

The drive to perform or engage in an activity due to external rewards or pressures, rather than for intrinsic enjoyment or satisfaction.