Which of the Following Is Not True of an Equity

question 134

Multiple Choice

Which of the following is not true of an equity carve-out?

• A) Creates cash infusion for the parent
• B) Change in equity ownership of the unit involved in the carve-out
• C) New shares issued to the public
• D) Taxable if proceeds returned to shareholders through a dividend or stock buyback
• E) Parent ceases to exist

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Definitions:

Fuzz

Fine, soft hair or fibers on the surface of a plant, animal, or material, giving a fluffy texture.

Rain Shadow

Dry region downwind of a coastal mountain range.

Leeward

The side of an object or area that is sheltered from the wind, opposite to the windward side.

El Niño

A climate phenomenon characterized by the warming of ocean surface waters in the central and eastern Pacific, leading to significant weather changes worldwide.