Bidnick Stewart Article Essay

Submitted By Adam-Bidnick
Words: 370
Pages: 2

Martha Stewart Article
(18 points)
*Please type your answers in red

1. Does your group believe that Martha Stewart was justifiably charged and ultimately convicted of collusion and perjury? Explain your answer. Yes, because she did break the law and deserves to serve her time just as everyone else would.

2. When an executive is privy to information that could negatively impact the stock price and therefore the investment of the shareholders, is he morally obligated to share in that negative impact? Explain your answer No, because that wpuld take out the risk of the stock market where as if he didn’t tell people if would allow people to lose money that they invested.

3. The motivation that an insider has to sell or buy stocks based on information that is not publicly available is that the insider seeks to make or avoid the loss of money. However, does this activity come at the expense of any shareholders? Explain your answer. Yes, it does effect shareholders because they could not lose as much money when someone who waits would lose their money.

4. While the CEO of ImClone did sell a large portion of his shares in order to avoid financial loss, did his sale affect the value of the other shareholder’s stock? Explain your answer. Yes, because more stock is available for the public that could make the price drop or raise a lot of money.

5. Since the executive essentially is employed by the shareholders, do you agree or disagree with Moore’s antique blanket analogy on page