Which of the Following Is Not a Characteristic of a Spin-Off

question 52

Multiple Choice

Which of the following is not a characteristic of a spin-off?

• A) The parent creates a new legal subsidiary for the business to be spun-off
• B) The shares of the new subsidiary are sold to the public
• C) The ownership of shares in the new legal subsidiary is the same as the stockholders' proportional ownership of shares in the parent firm
• D) The new business once spun-off has its own management and board
• E) Spin-offs are generally not taxable to the parent's shareholders if properly structured

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Definitions:

Cognitive Appraisal

The process of evaluating and interpreting an event or situation that leads to an emotional response.

Split-Second Fear

A rapid, automatic fear response to a perceived threat, occurring in a fraction of a second.

Unconscious

Pertaining to the part of the mind that is inaccessible to the conscious mind but influences behaviors, thoughts, and feelings.

Neural Processing

The method by which the nervous system receives, interprets, and responds to signals from the sensory organs or other neural inputs.