A Freeze-Out

question 6

Multiple Choice

A freeze-out:

• A) occurs when a majority shareholder is "frozen out" by the management regarding such issues as a reduction or elimination of dividends.
• B) can be easily reversed in court.
• C) results in the minority shareholder having little influence in important corporate issues such as loss of employment.
• D) occurs mostly in S corporations.

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Definitions:

Channels of Command

The formal lines of authority and communication in an organization, through which orders and decisions are passed down.

Differentiation

The process of distinguishing or creating differences between objects, concepts, or entities.

Decision-Making

The cognitive process of selecting a course of action among several alternatives, crucial in clinical settings for determining patient care strategies.

Coordination

The organization of the different elements of a complex body or activity so as to enable them to work together effectively.