When managers and executives know more about the future plans of a company than its shareholders, what is this phenomenon called?

Question

Quizplus · Accepted Answer

This phenomenon is called information asymmetry, which refers to a situation in which one party in a transaction has more or better information than the other party. In this case, the managers and executives have information that the shareholders do not, which can put the shareholders at a disadvantage. Insider trading refers specifically to the illegal use of insider information for financial gain. The other options are not commonly used terms.

When Managers and Executives Know More About the Future Plans