When Apple Inc

question 120

Multiple Choice

When Apple Inc.developed and introduced the iPhone it was unique as it essentially combined a cellular phone with an iPod,an Internet browser,and email capabilities.As such,in the short run it seemed that demand for the product would be inelastic,with no real existing competition.The recommend pricing strategy in such a situation would be:

• A) low initial price,rising slightly when entering the growth stage
• B) high initial price,falling slightly when entering the growth stage
• C) high price,continuing through growth and maturity
• D) low price,continuing through growth and maturity
• E) low price initially,rising constantly through growth and into maturity

---

Definitions:

Freeze-Out Acquisition

A strategy used in mergers and acquisitions where a majority shareholder forces out minority holders to take full control of the company.

Share Split

Traditionally, a corporation’s dividing existing shares into two or more shares, thereby increasing the number of authorized, issued, and outstanding shares and reducing their par value. In modern corporation law, treated like a share dividend. Also called stock split.

Total Fairness Test

A legal standard used to evaluate the overall fairness and equity of a corporate action or decision, especially in mergers and acquisitions.

Straight Voting

A form of voting for directors that ordinarily permits a shareholder to cast a number of votes equal to the number of shares he or she owns for as many nominees as there are directors to be elected. See also cumulative voting.