American Greetings,a Family-Owned Corporation,wished to Take the Company Private,and the Family

question 45

Multiple Choice

American Greetings,a family-owned corporation,wished to take the company private,and the family shareholders made an offer to purchase the shares of all non-family members.The family owns 10% of the company's shares,but has 50% of the voting power.The board refused to approve the offer for the shares because the price was too low.Which of the following is correct?

• A)The approval of the board is not required for the family purchase of shares.
• B)The board's failure to approve the transaction means that the acquisition cannot be done without dissenting shareholders.
• C)The approval of the board cannot be obtained until the family uses its votes to restructure the board with directors friendly to its proposal.
• D)Those with a minority interest cannot acquire other shares.

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Definitions:

Mixed Economy

An economic system blending elements of market capitalism with some form of government intervention and public enterprise.

Barter Economy

An economic system where goods and services are exchanged directly for other goods and services without using money.

Command Economy

An economic system where the government or central authority makes all decisions related to the production and distribution of goods and services.

Traditional Economy

An economic system rooted in tradition, customs, and beliefs, where resources are allocated based on inheritance and bartering is common, often found in rural and farm-based areas or developing countries.