What Type of Transaction Employs Special Committees Made Up of Disinterested

question 25

Multiple Choice

What type of transaction employs special committees made up of disinterested board members who review the transaction to determine if it is entirely fair to the corporation?

• A)hostile takeover
• B)self-dealing
• C)rational business purpose
• D)corporate opportunity

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Definitions:

Self-Sufficient

The quality or condition of being able to fulfill all one's needs without reliance on external assistance.

Specialize

To focus on a specific area of production or study to gain efficiency or expertise.

Gains from Trade

The increase in welfare or economic benefit that countries or individuals obtain by engaging in voluntary exchanges where they specialize according to their comparative advantages.

Equilibrium

A state in a market where supply equals demand, leading to a stable situation where there is no tendency for prices to change, assuming other factors remain constant.