Under the "Close-Connection" Doctrine,a Holder Has Taken So Many Instruments

question 15

True/False

Under the "close-connection" doctrine,a holder has taken so many instruments from its transferor or is so closely connected with the transferor that any knowledge the transferor has is deemed transferred to the holder,preventing holder in due course status.

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Definitions:

Diluted Earnings

Earnings per share calculated by including the effects of all potential dilutive securities, which could decrease earnings per share by increasing the number of shares outstanding.

Potential Dilutive Effect

The possible impact on a company’s earnings per share if convertible securities were converted into common stock, often considered in financial analysis.

If-Converted Method

A calculation technique used to assess the impact on diluted earnings per share if all convertible securities were converted into common stock.

Convertible Securities

Financial instruments, such as bonds or preferred stocks, that can be converted into a predetermined number of common stock or equity shares.