Mr Amit, a stock market trader through inside information, comes to know that share price of X Ltd is likely to go up in future, so he purchases the…

CA Foundation · Business Economics · MTP · June 2024
Mr Amit, a stock market trader through inside information, comes to know that share price of X Ltd is likely to go up in future, so he purchases the shares to make a gain by selling them later at higher price. It is a case of:
(A) A. Moral Hazard
(B) B. Asymmetric Information
(C) C. Free Riding
(D) D. None of the above

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. Asymmetric Information

Topics: Determination of National Income

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