Fact Pattern 31-2

question 53

Multiple Choice

Fact Pattern 31-2
Sid, a director of Tech Software Company, learns that a Tech engineer has developed a new, exciting video game. Sid buys Tech stock and tells his friend Uri, who also buys Tech stock. When the new game is released three weeks later, Sid and Uri sell their stock for a big profit.
-Refer to Fact Pattern 31-2. Under SEC Rule l0b-5, Sid would not be liable if he had waited to buy Tech stock until

• A) after Sid told Uri of the new game.
• B) after Uri bought Tech stock.
• C) after the public release of the game.
• D) just before the game was released.

---

Definitions:

Self-correcting Forces

Economic mechanisms that naturally work to restore equilibrium in markets without government intervention.

Potential GDP

The maximum output an economy can produce without triggering inflation, if it fully employs all available resources, including labor and capital.

Expansionary Gap

A situation where the actual level of output in an economy exceeds its potential output, often leading to inflation.

Active Approach

An active approach in policy-making or investment strategy entails ongoing, deliberate interventions or decisions to achieve specific economic or financial goals.