A Firm Is Using Cumulative Voting and Four Director Spots

question 15

Multiple Choice

A firm is using cumulative voting and four director spots are up for election. There are 3.6 million shares outstanding. How many shares must a minority owner own or control to ensure that he or she can gain control of one seat on the board of directors?

• A)900,001
• B)880,001
• C)720,001
• D)1,800,001
• E)1,750,001

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Definitions:

Hertz

The unit of frequency in the International System of Units (SI), equivalent to one cycle per second, used to measure the frequency of alternating currents and sound waves.

Cycle

One complete AC waveform.

Effective

Producing a decided, decisive, or desired effect, particularly in the context of performance or efficiency.

Peak-to-peak

Refers to the difference in amplitude between the highest and the lowest points of a waveform, indicating the total voltage change.