tipper/tippee theory
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Bobby is an employee of a publicly traded corporation, and holds stock and stock options. As a member of the product development team, he has been working on the design of a new product at the company. For its part, the company has been pinning most of its future economic hopes on the
success of the release of the product. However, the development of the product has not gone public yet. The company is keeping the entire project a complete secret until it releases it publicly. The company has been so secretive about the new product that no one but Bobby knows the release
date yet. When Bobby realizes this, he decides to use this information to profit heavily by purchasing as much stock as he can afford in the company right before the product goes public. Then, when the stock prices rise after the successful release of the product, he plans to sell it all.
- What kinds of information are considered "material information" when discussing insider trading? Would the information Bobby used to be considered material?
- Suppose Bobby decides to share this information with his best friend Brenda so she can make some money, too. What is the tipper/tippee theory? In this case, who is the tipper, and who is the tippee? Is Brenda guilty of insider trading too?
- What are the penalties Bobby could face for insider trading?
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