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FSOT Full Test Bank

Category - Economics

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Which of the following is an example of insider trading?

A person inside the company uses secret information to make trades.
A person at a partner company uses secret information to make trades.
A person with tips from a friend inside the company uses that information to make trades.
All of the above

Explanation

Answer: D - All of the above are examples of insider trading. Rules against insider trading prohibit trading based on knowledge that is not freely available to the market; it doesn’t matter who is using that knowledge.

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