Become familiar with the general basics of the regulatory rules applying to insider trading. You are not expected to become an expert in this topic. Apply this rule to the facts of this very brief case:

Someone you know has knowledge of an impending merger between two companies. The combination of the two firms will certainly change the market dynamics of the industry and owners of stock in either company will greatly benefit, once the news of the merger is publicly announced.

what is the socio-economic implications of this?

please be familiar with the SEC regulations on insider trading.