Greg,the president of an IT company,is friends with Jack,the CEO of HyperTech,a company that develops and manufactures computer hardware.Jack tells Greg that HyperTech is about to announce the creation of a revolutionary new computer processor that will quadruple processing capacity and cause HyperTech's sales and profits to skyrocket.Greg then purchases a large number of shares of HyperTech company stock before the news of the new computer processor is made public.In which illegal activity has Greg engaged?
A)a Ponzi scheme
B)short selling
C)issuing a call
D)information abuse
E)insider trading

Question

Quizplus · Accepted Answer

Greg has engaged in insider trading, which is illegal. He used confidential information that he obtained from his friend, the CEO of HyperTech, to make a profit from buying shares before the news of the new computer processor was made public. This is a violation of securities laws and can result in fines and/or imprisonment.

Greg,the President of an IT Company,is Friends with Jack,the CEO