The Conflict of Interest That Arises When a Shareholder Who

question 35

Multiple Choice

The conflict of interest that arises when a shareholder who has a controlling interest in multiple firms moves profits away from companies in which he has relatively less cash flow rights toward firms in which he has relatively more cash flow rights is called:

• A)expropriation.
• B)earnings management.
• C)tunnelling.
• D)profit mining.
• E)cash extraction.

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Definitions:

Rack And Pinion

A type of linear actuator that involves a circular gear (the pinion) engaging a linear gear (the rack) to create linear motion from rotational motion.

Fifth Wheel

A pivoting platform attached to a tractor or truck chassis that provides a coupling point for a semi-trailer.

Axle

A rod or bar on which wheels turn or the housing that supports wheel assemblies. Also used to describe the shaft that transmits drive torque to the drive wheels.

Drivelines

Components, including the driveshaft, axles, CV joints, and differential, that transmit power from the engine to the wheels of a vehicle.