Which of the Statements Below Is FALSE

question 62

Multiple Choice

Which of the statements below is FALSE?

• A)If an investor purchases 20% of the initial issue of the company,the investor then owns 20% of the company,given the one vote-one share norm.
• B)After an initial offering,the company can sell more shares to the public at a later date.If the investor who originally purchased 20% does not purchase 20% of the subsequent issue,his or her ownership is diluted below 20%.
• C)A preemptive right enables one to maintain one's proportional level of ownership.
• D)A preemptive right is never particularly valuable to shareholders with large ownership percentages.

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Definitions:

Arbitration Agreement

A contract in which two or more parties agree to settle a dispute outside of the court system, typically through the decision of a neutral third party.

Federal Judge

A judge appointed by the president of the United States and confirmed by the Senate, serving within the federal court system.

Arbitration Agreement

A written contract in which two or more parties agree to settle a dispute outside of court through the arbitration process.

Punitive Damages

Monetary compensation awarded to an aggrieved party that goes beyond what is necessary to compensate for losses and is intended to punish the wrongdoer.