A Trend That Has Been Reinforced by Many Developing Countries

question 42

Multiple Choice

A trend that has been reinforced by many developing countries is privatization. Privatization refers to

• A) purchasing large companies and turning them into state-owned enterprises.
• B) investing government money in large, privately-owned companies.
• C) exchanging bonds for shares in state-owned enterprises.
• D) selling large state-owned enterprises to private owners in the financial sector.
• E) selling large state-owned enterprises to private owners in key areas such as electricity, telecommunications, or petroleum.

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Definitions:

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and a claim on a portion of its profits.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee, but not control them, typically associated with ownership of 20-50% of voting stock.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee but not control them.

Book Value

The net value of a company's assets minus its liabilities, often used as a measure of its equity.