Which of the following are commonly considered alternative models of corporate governance?
A. Market model
B. Control model
C. Takeover model
D. A & B only
E. A & C only
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Which of the following factors influences corporate governance practices?
A. Securities legislation
B. Government regulatory agencies
C. The threat of a hostile takeover
D. Institutional activism
E. All of the above
Which of the following is true about supervoting stock?
A. Is a commonly used takeover tactic.
B. Is generally encouraged by the SEC
C. May have 10 to 100 times of the voting rights of other classes of stock
D. Is issued to acquiring firms if they agree not to purchase a controlling interest in the target firm
E. Is a widely used takeover defense
Which is true of the following? A white knight
A. Is a group of dissident shareholders which side with the bidding firm
B. Is a group of the target firm’s current shareholders which side with management
C. Is a third party that is willing to acquire the target firm at the same price as the bidder but usually removes the target’s management
D. Is a firm which is viewed by management as a more appropriate suitor than the bidder
E. Is a firm that is willing to acquire only a large block of stock in the target firm
Which of the following is true? A hostile takeover attempt
A. Is generally found to be illegal
B. Is one that is resisted by the target’s management
C. Results in lower returns to the target firm’s shareholders than a friendly attempt
D. Usually successful
E. Supported by the target firm’s board and its management