A Proxy Fight Occurs When a Company Attempts to Persuade

question 5

Multiple Choice

A proxy fight occurs when a company attempts to persuade the target company's shareholders to replace the existing management with one that is ________ the goals of the acquiring company.

• A)unaware of
• B)hostile toward
• C)familiar with
• D)sympathetic to

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Definitions:

Negative APS

Refers to a situation where average propensity to save is below zero, indicating that consumption exceeds income, leading to dissavings.

Disposable Income

The net income available to an individual or household after taxes have been deducted, used for savings or spending on goods and services.

Induced Consumption

An increase in spending on goods and services caused by an increase in income, reflecting a direct relationship between income levels and consumer spending.

APS

Average Propensity to Save, the fraction of income that is saved rather than spent on consumption goods.