Which of the Following Is the Best Definition of a Poison

question 200

Multiple Choice

Which of the following is the best definition of a poison pill?

• A) The splitting up of a company into two or more companies.
• B) The distribution of shares in a subsidiary to existing parent company shareholders.
• C) Provisions allowing existing shareholders to purchase stock at some fixed price should an outside takeover bid take place, discouraging hostile takeover attempts.
• D) Attempts to gain control of a firm by soliciting a sufficient number of shareholder votes to replace existing management.
• E) A financial device designed to make unfriendly takeover attempts unappealing, if not impossible.

---

Definitions:

Five-Year Period

A duration or span of time that lasts for five consecutive years.

Stock Valued

The process of determining the intrinsic value of a stock based on predictions of future earnings and the company's overall financial health.

Increased

An upward adjustment in quantity, size, intensity, or the like.

Compound-Interest GIC

A Guaranteed Investment Certificate (GIC) that grows by earning interest on the principal and the accumulated interest over time.