Which of the Following Is Not a Characteristic of a Spin-Off

question 52

Multiple Choice

Which of the following is not a characteristic of a spin-off?

• A) The parent creates a new legal subsidiary for the business to be spun-off
• B) The shares of the new subsidiary are sold to the public
• C) The ownership of shares in the new legal subsidiary is the same as the stockholders' proportional ownership of shares in the parent firm
• D) The new business once spun-off has its own management and board
• E) Spin-offs are generally not taxable to the parent's shareholders if properly structured

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Definitions:

Allergy

An immune system response that occurs when the body mistakenly identifies a normally harmless substance as a threat.

High Fever

An elevated body temperature significantly above the normal range, often indicating an underlying condition or infection.

Common Cold

A viral infection of the upper respiratory tract, which affects the nose, throat, and sinuses, leading to symptoms like sneezing, coughing, and a runny nose.

Influenza

A highly contagious viral infection of the respiratory passages causing fever, severe aching, and catarrh, often occurring in epidemics.