PRC-3 · Chapter 6 · Question 52 of 68
An executive secretary reads an unreleased memo detailing an upcoming massive tech patent. He immediately calls his broker and buys 10,000 shares of the company before the public finds out. What is this illegal practice?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Insider trading
Explanation
Insider trading occurs when an individual buys or sells stock in a publicly traded company based on material, non-public information.
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