Space Shuttle Challenger stock market

On Tuesday, January 28, 1986, the Space Shuttle Challenger exploded 73 seconds after its take-off. Rogers Commission searched for five months to find out the problem related to explosion. However, the stock markets punished Morton Thiokol, one of five contractors, on the same day of the explosion. What took Rogers Commission five months to establish, the stock market was able to do within a few hours. Only the stock prices of Morton Thiokol plummetted that day. How do you explain this considering our in-class discussions?

Sample Solution