A Reduction from the List Price That a Seller Gives

question 120

Multiple Choice

A reduction from the list price that a seller gives a buyer as a reward for some activity of the buyer that is favorable to the seller is called

• A) the pretax price.
• B) the list price.
• C) the manufacturer's suggested retail price (MSRP).
• D) a discount.
• E) a trade-in allowance.

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Definitions:

Preemptive Right

Gives the current shareholders the right to purchase any new shares issued in proportion to their current holdings. The preemptive right enables current owners to maintain their proportionate share of ownership and control of the business.

Proxy Fight

An attempt to take over a company in which an outside group solicits existing shareholders’ proxies, which are authorizations to vote shares in a shareholders’ meeting, in an effort to overthrow management and take control of the business.

Dissident Shareholders

Shareholders who disagree with the company's management and policies, often expressing their dissatisfaction through votes against management proposals.

Semistrong-Form Market Efficiency

A form of market efficiency that posits all public information is already reflected in stock prices, alongside historical data.