If a Shareholder or Investor Wants to Acquire New Stock

question 10

Multiple Choice

If a shareholder or investor wants to acquire new stock under a rights plant they must:

• A) acquire new stock in the market to get a controlling fraction of shares to be eligible for rights.
• B) simply pay a registration fee and turn in the subscription price.
• C) acquire the correct rights per share desired, then turn the rights and the total subscription price into the subscription agent.
• D) acquire the correct rights and wait for the company to send you the stock.
• E) call their broker and sell some CBOE options to make any money.

---

Definitions:

Economies of Scale

Cost advantages a business obtains due to expansion, characteristically causing a decrease in fixed costs per unit of production.

Conglomerate Mergers

Conglomerate mergers involve companies from unrelated business activities or industries merging, often to diversify business operations and risk.

Market Share

The portion of a market controlled by a particular company or product.

Financial Results

The summary outcomes of a company's operations and activities, often presented in terms of income, revenue, profit, and loss.