Sehun (1986) Finds That the Practice of Monitoring Insider Trade

question 40

Multiple Choice

Sehun (1986) finds that the practice of monitoring insider trade disclosures, and trading on that information, would be

• A) extremely profitable for long-term traders.
• B) extremely profitable for short-term traders.
• C) marginally profitable for long-term traders.
• D) marginally profitable for short-term traders.
• E) not sufficiently profitable to cover trading costs.

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Definitions:

Tax Cuts

Reductions in the amount of taxes imposed by a government on individuals or entities.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, usually measured by the rise in GDP.

Federal Budget Deficit

A situation where the federal government's expenditures exceed its revenues within a given fiscal year.

Paradox of Thrift

If everyone tries to save more, they will all end up saving less.