According to the class overheads and basic ethics, which one of the following assertions about insider trading, which is against the law, is true?Insider trading is legal and should not be considered as a potential approach to investingInsider trading is illegal and should be considered as a potential approach to investingInsider trading is legal and should be considered as a potential approach to investingInsider trading is illegal and should not be considered as a potential approach to investing

Insider trading, which may be described as the purchasing or selling of an asset based on…

Answered: According to the class overheads and…

Business/Professional Ethics Directors/Executives/Acct

8th Edition

ISBN:9781337485913

Author:BROOKS

Publisher:BROOKS

Chapter2: Ethics & Governance Scandals

Section: Chapter Questions

Problem 4Q

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1 Identify the main ethical arguments that have been used against insider trading.
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What is the knowing misrepresentation of the truth in order to trick someone into entering into a contract? Fraud O Duress O Embezziement Mistake
Unethical acts are generally committed by unethical people. What are some things companies can do to help ensure that their employees act ethically?
Which of the following arguments supports the view that regulation is not necessary, particularly to the extent that it currently exists? Select one: a. Markets for information are not efficient and therefore produce a sub-optimum amount of information, given the problem of 'free riders'. b. Accounting information is like any other good, and people will be prepared to pay for it to the extent that it has a use. c. Investors need protection from fraudulent organisations that may produce misleading information. d. Information asymmetry exists because not everyone has the same power over resources to obtain the information they need.
When does insider trading occur? What government agency is responsible for protecting against the unethical practice of insider trading?
5. Which of the following is true of Regulation A securities? O a. They are not subject to transfer restrictions. O b. They cannot be offered publicly even with general advertising. O c. They require a lengthy and complicated registration process. O d. They may be applied for by those who have been involved in previous securities fraud cases.
When an employee is in a position to detect and hide fraudulent activity, incompatible obligations exist. False or True?
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Which of the following about materiality is NOT true? A. Information is material if, in determining a choice of action, a reasonable person would attach importance to it. B. A fact is only material if a reasonable person actually was influenced by the information. C. A fact that, if it have been correctly stated or disclosed, would have influenced the decision of the average prudent investor is material. D. Information about which an average prudent investor ought reasonably to be informed is material.
Necessary: (a) In the given situation, who took the larger risk: Khaled Assadi or Kyle Lagow. (a) Explain your reasoning by referring to (a). (c) Discuss if GE Energy's claimed conduct is more unethical than Countryside Financial's conduct.
What causes people to commit occupational fraud?

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