Question

According to the Securities and Exchange Commission (SEC), a person should be considered to be a temporary insider if that person conveys nonpublic information that was to have been kept confidential. This philosophy has become known as the

a. quasi-insider theory.
b. implied-insider theory.
c. temporary insider theory.
d. misappropriation theory.
e. mosaic theory.

Answer 1

The correct answer is letter "D": misappropriation theory.

Step-by-step explanation:

The misappropriation theory states that someone who uses insider information in trading securities is guilty of securities fraud. That person could be convicted for insider trading because this is a deceptive practice. This theory aims to protect the securities markets with equal accessibility to information.