Mr a Is the Sole Shareholder of X Ltd

question 116

Multiple Choice

Mr. A is the sole shareholder of X Ltd., and is also a director of Y Ltd. Y Ltd. is negotiating to buy property from X Ltd. Which of the following is False?

• A) Failure to disclose his interest will make Mr. A liable to Y Ltd. for any profits he makes on the transaction and for any losses suffered by Y Ltd.
• B) So long as Mr. A discloses his position to the board of directors of Y Ltd., he can vote in favour of the contract at the directors' meeting.
• C) Mr. A does not owe a fiduciary duty to X Ltd. or to his fellow X Ltd. shareholders.
• D) To protect himself, Mr. A must disclose his interest to the other directors and refrain from voting or influencing the decision.
• E) Mr. A has a duty to act in the best interests of Y Ltd., and to avoid any conflict of interest.

Determine the effects of market power and competition on pricing decisions.

Understand the implications of pricing strategies on consumer perception and demand.

Analyze the effects of mergers on price-cost margins and industry competition.

Evaluate the financial impacts of cover charges, fees, and price changes on a business's profitability.

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Definitions:

Bargain and Sell

A term used in real estate and contract law to refer to a type of conveyance or transfer of property ownership, often without the formalities of a traditional sale.

Convey

To transfer or deliver title, interest, or property from one person to another through a deed or other document.

Quitclaim Deeds

Legal documents used to transfer a claim, interest, or right in property from one party to another without any assurance of the validity of the grantor's claim.

Technical Defects

Flaws or imperfections in a product that affect its operation, often due to errors in manufacturing or design.