Sam is a manager at StyleOne Apparels Inc.and is friends with the company's CEO.This privilege gives Sam the information that StyleOne Apparels is in the midst of talks to take over a leading rival.Sam buys stocks of StyleOne with the expectation that its stocks will appreciate.But the deal falls through and the stocks of StyleOne depreciate in the following months.Are Sam's actions unethical? Why?
A) Yes, because it is unethical to trade stocks based on insider information irrespective of the final outcome.
B) Yes, because it is illegal and unethical for Sam to possess any kind of insider information.
C) No, because Sam did not ask the CEO to disclose such information to him.
D) No, because Sam did not make any profits from trading stocks using this information.
Correct Answer:
Verified
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