Describe Power-Threat Theory as Set Out by Blalock

question 5

Essay

Describe power-threat theory as set out by Blalock.

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Definitions:

Subsidiary

An entity that is controlled by a higher entity, usually through majority shareholding, and is included in the financial statements of the controlling entity through consolidation.

Investment

The allocation of resources, usually financial, in expectation of a future return or profit.

Equity

The value of an ownership interest in a company, represented by the portion of the company's assets that would be distributed to shareholders after settling all liabilities.

Acquisition

The process by which one company takes over another and clearly establishes itself as the new owner.