When a Takeover Bid Is Initiated, the Board of Directors

question 19

Multiple Choice

When a takeover bid is initiated, the board of directors of the target firm has the legal obligation to its shareholders to

• A) recommend acceptance or rejection, or remain neutral, with written reasons.
• B) defend against the bid.
• C) remain neutral on the merits of the bid.
• D) remain silent on the merits of the bid.
• E) resign.

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Definitions:

Gravity

A fundamental force of nature by which all things with mass or energy are brought toward one another, including objects ranging from atoms to planets and galaxies.

Universal Causality

The principle that every event has a cause, suggesting a fundamental order to the universe and the predictability of phenomena.

Hume

A philosopher who contributed significantly to ethics, epistemology, and the philosophy of religion with his inquiry into human nature.

Billiard Balls

Often used in physics and philosophy as a metaphor or example to illustrate classical mechanics, causality, and the predictability of events under certain conditions.