Asked by Eunice Monpremier on Jun 04, 2024
Verified
A majority shareholder can sell her shares at a:
A) premium.
B) discount.
C) bonus.
D) markdown.
Majority Shareholder
An individual or entity that owns more than half of a company's shares, giving them significant control.
Premium
The amount paid for an insurance policy, or an amount paid above the normal cost of something.
- Recognize and elucidate the principles of mechanisms for shareholder oppression, including the exclusion of minority shareholders.
Verified Answer
AC
Allison CespedesJun 08, 2024
Final Answer :
A
Explanation :
The per share value of the shares of a majority shareholder of a corporation is greater than the per share value of the shares of a minority shareholder.This difference in value is due to the majority shareholder's ability to control the corporation and to cause it to hire her as an employee at a high salary.Therefore,a majority shareholder can sell her shares for a premium over the fair market value of minority shares.
Learning Objectives
- Recognize and elucidate the principles of mechanisms for shareholder oppression, including the exclusion of minority shareholders.