Finance Derivative Securities problems

Instructions: Let’s revisit the case studies we used in Week 1. Please read each scenario carefully and answer the following questions: (1) If you were the judge, how would you achieve specific deterrence in each scenario? (2) How would you achieve general deterrence? (3) Is your decision consistent with Beccaria’s arguments on the certainty, celerity (swiftness), and severity of punishment? Your response to EACH case study should be at least 150 words.1 You are a police officer and you are buying a cup of coffee at the local “Stop and Rob” convenience store. You see a juvenile male place a quart of milk inside his jacket. You approach the person and tell him to open his jacket. He complies. He apologizes for his actions. He explains that he could not afford to buy the milk but he needs it for his child. He promises not to do it again and asks you to let him go.2 A major pharmaceutical company introduces a new weight-loss drug. Although the pharmaceutical company knows that the drug may increase the chances of heart attacks and strokes, the company’s warning label states that, “Product X has no known side effects.” After the drug is linked to hundreds of heart attacks and strokes and dozens of deaths, the company pulls the drug off the market.3 Laura has had a hard day at work. Before going home, she decides to stop at a local bar and have a couple drinks. After consuming several drinks, she decides to drive home. She runs a red light and crashes head-on into another vehicle. The two occupants of the other vehicle are killed. One of the occupants of the car was 6 months pregnant at the time of the crash. Laura’s blood alcohol content was .18. She has a previous conviction for Driving Under the Influence (DUI).4 John and Amy have been in a relationship for 10 years. Amy has grown tired of the relationship and has been having an affair with another man for the last 6 months. Amy and her lover make a plan to kill her husband. Amy takes out a $500,000 life insurance policy on her husband. Several weeks later, her lover breaks into Amy’s house and shoots and kills her husband. He takes a few valuables from the house to make it look like a burglary.5 You and your partner are dispatched to a domestic dispute. When you arrive, you hear loud voices inside the house. You knock on the door and announce that you are with the police department. A small-framed male answers the door. You advise him that you’ve received a call about a domestic dispute. You notice that the man has a small amount of blood dripping from his lower lip, which also appears to be bruised. You ask the man if he is okay or in need of medical attention. In an effeminate voice, he advises you that he and his “roommate” have had a little fight that “got out of hand.” A larger male is standing in the kitchen and he seems irritated that you are there. He speaks up and says “We were arguing and I lost my temper a little.” The smaller male advises you that he does not need medical attention and that he does not want to press charges.