B-Sharp Corporation and Coding Company Wish to Combine All Assets

question 43

Multiple Choice

B-Sharp Corporation and Coding Company wish to combine all assets, stock, and personnel into a new firm to be called DigiSongs Inc. This is​

• A) ​a consolidation.
• B) ​a merger.
• C) ​a share exchange.
• D) ​a takeover.

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Definitions:

Strike Price

The predetermined price at which an option can be exercised, allowing the holder to buy (in the case of a call option) or sell (in the case of a put option) the underlying security.

Puts

Options contracts giving the owner the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Underlying Security

The asset upon which a derivative contract, such as an option, is based.