Mr a Is the Sole Shareholder of X Ltd

question 89

Multiple Choice

Mr. A is the sole shareholder of X Ltd., and is also a director of Y Ltd. Y Ltd. is negotiating to buy property from X Ltd. Which of the following is false?

• A) Mr. A. has a duty to act in the best interests of Y Ltd., and to avoid any conflict of interest.
• B) So long as Mr. A discloses his position to the board of directors of Y Ltd., he can vote in favour of the contract at the directors' meeting.
• C) To protect himself, Mr. A must disclose his interest to the other directors and refrain from voting or influencing the decision.
• D) Failure to disclose his interest will make Mr. A liable to Y Ltd. for any profits he makes on the transaction and for any losses suffered by Y Ltd.
• E) Mr. A. does not owe a fiduciary duty to X Ltd. or to his fellow X Ltd. shareholders.

Comprehend the importance of investment companies in financial planning and achieving long-term goals.

Grasp the reasons behind the demographic distribution of mutual fund ownership.

Explain the processes involved in purchasing, managing, and withdrawing from mutual funds.

Understand the role and functions of rating agencies in evaluating mutual funds.