In Which of the Following Prohibited Practices,if Any,was Linda Engaged

question 31

Multiple Choice

In which of the following prohibited practices,if any,was Linda engaged by purchasing the shares after she found out about the merger?

• A) Insider trading
• B) Outlaw trading
• C) Presidential trading
• D) Officer profiting
• E) She did not engage in any prohibited practices because as president, she had the legal right to profit from the upcoming sale.

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Definitions:

Herfindahl Index

A measure of the size of firms in relation to the industry and an indicator of the amount of competition among them.

Horizontal Merger

A merger between firms that are in the same industry, often aimed at reducing competition and achieving economies of scale.

Herfindahl Index

An index calculating market concentration by summing the squares of the market shares of each firm within the industry.

Conglomerate Merger

A type of merger where two or more firms in unrelated business sectors combine to reduce risk or expand their portfolio.