Which of the Following Is Not a Reason for an Entity's

question 20

Multiple Choice

Which of the following is not a reason for an entity's preference to have less than 100% ownership interest in some subsidiaries:

• A) to decrease the cash necessary to acquire the control over the subsidiaries.
• B) to incentivise the subsidiary's executives by allowing them to hold a non-controlling interest.
• C) to comply with regulatory requirements.
• D) to receive the whole gain on acquisition.

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Definitions:

High Risk

A situation or condition that poses a greater likelihood of negative outcomes or dangers.

Negative Schema Theory

A psychological theory that suggests individuals with a predisposition to view the world negatively are more susceptible to psychological disorders.

Trauma

A deeply distressing or disturbing experience that can have long-term psychological impact.

Cognitive Approach

A perspective in psychology that emphasizes the importance of mental processes in how people perceive, remember, think, and solve problems.