Determine possibly guilty


Problem:

Kista received a tip from an employee that her company, World Industries is about to make a bid to buy Carlton Slate Corporation at a price of $100 per share. Krista went online and saw that the information was not yet public and Carlton was trading for $60 per share. Drista bought 500 shares. Of what, if anything, is Krista possibly guilty?

  • Selective disclosure
  • Insider trading
  • Full and fair disclosure
  • Embezzlement
  • Nothing, since Krista isn't an employee of either company

Note: Please provide equation and explain comprehensively and give step by step solution.

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Finance Basics: Determine possibly guilty
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