1. The number of corporate acquisitions is _______________ in the 1990s than it was in the 1950s.

a. much higher
b. somewhat higher
c. somewhat lower
d. much lower

2. Alpha and Beta combine, and afterwards only Alpha continues to exist. This is a

a. merger.
b. consolidation.
c. both A and B
d. none of the above

3. Alpha and Beta merge, and Beta is the surviving corporation. There have been no formal transfers of assets between Alpha and Beta. Which of Alpha's characteristics has Beta acquired?

a. assets
b. debts
c. both A and B
d. none of the above

4. Alpha and Beta consolidate. Which of them continues to exist?

a. Alpha
b. Beta
c. both A and B
d. none of the above

5. Alpha and Beta merge, and Beta is the surviving corporation. To whom must Beta now issue shares or give other consideration?

a. Alpha shareholders
b. Beta shareholders
c. both A and B
d. none of the above

6. Alpha and Beta are considering a merger. The board of directors of __________ corporations must approve the move, as well as at least _______________ of the shareholders of each corporation.

a. at least one; 1/2
b. at least one; 2/3
c. both; 1/2
d. both; 2/3

7. Alpha is the parent corporation of Beta. Alpha owns 95% of Beta stock, and wishes to merge with Beta. Which of the following must approve such a move?

a. Alpha's board of directors
b. Beta's board of directors
c. 2/3 of Beta's shareholders
d. all of the above

8. Gary is a shareholder of Alpha Corporation. Alpha recently voted by a 4/5 majority to merge with Beta, but Gary voted not to merge. He does not wish to be a shareholder in the newly merged company. To what is he entitled?

a. nothing
b. the fair value of his shares as of the date of the merger
c. the fair value of his shares as of the date he files a complaint
d. twice the fair value of his shares

9. When a shareholder exercises appraisal rights, the corporation must make a(n) ___________ offer to buy the shares. If the shareholder and corporation disagree on the fair value of the shares, _______________ will decide what fair value is.

a. written; a court
b. written; the market
c. oral; the market
d. oral; a court

10. Alpha Corporation attempts to merge with Beta, but the Beta shareholders vote down the proposed merger. May Alpha now attempt to acquire Beta's assets by direct purchase?

a. yes, but only if Alpha shareholders approve
b. yes, but only if Beta shareholders approve
c. yes, with no shareholder approval
d. no

11. Alpha purchases 99% of Beta's assets. Will they be liable for Beta's debts?

a. yes, because all acquisitions of another corporation's assets lead to an assumption of liability
b. yes, because this amounts to a merger
c. yes, but only if they retain all Alpha personnel
d. no

12. Alpha wants to acquire a majority interest in Beta, and so offers Beta shareholders $1 per share above market price for their Beta shares. This is an example of a(n) ________ , and Beta is the _______________ .

a. group offer; aggressor
b. group offer; target corporation
c. tender offer; aggressor
d. tender offer; target corporation

13. Which of the following options are available to a corporation that is making a tender offer?

a. The offer may be contingent on receiving a certain number of shares by a certain date.
b. The corporation may offer to exchange its own shares rather than cash for the shares of a target corporation.
c. both A and B
d. none of the above

14. Which of the following persons is in effective control of a corporation?

a. Al, who owns 51% of a corporation's stock
b. Ben, who owns 30% of a corporation's stock and the proxies of 25% of shareholders
c. both A and B
d. none of the above

15. Andy is attempting to secure the proxies of shareholders of Alpha Corporation. Alpha must give him _______________ assistance in locating and contacting Alpha shareholders.

a. no
b. only minimal
c. reasonable
d. extensive

16. The management of Alpha Corporation wishes to buy all shares of Alpha stock so that it gains control over the business. It will borrow against corporate assets to do so. They will attempt a

a. leveraged buy-out.
b. hostile takeover.
c. proxy fight.
d. tender offer.

17. Alpha Corporation is the target of Beta's takeover bid. They go to court to seek an injunction. The court may grant an injunction if

a. Beta's takeover bid is hostile.
b. Beta's market share in an industry would greatly increase with successful takeover.
c. both A and B
d. none of the above

18. The shareholders of Alpha Corporation have voted unanimously to end the life of the corporation. What has occurred?

a. liquidation
b. voluntary dissolution
c. involuntary dissolution
d. none of the above

19. Alpha Corporation has sold all of its assets and has distributed the proceeds to shareholders and creditors. What has happened?

a. liquidation
b. voluntary dissolution
c. involuntary dissolution
d. none of the above

20. After liquidating all assets, who has first priority in receiving payments from the funds raised?

a. creditors
b. preferred shareholders
c. holders of common shares
d. both A and C

21. Alpha corporation raises $100,000 during liquidation. It owes creditors $10,000, and owes preferred shareholders $50,000. Al holds 10% of Alpha's common stock. How much of the $100,000 will he likely receive?

a. $0
b. $4,000
c. $9,000
d. $10,000

22. When can a court order the dissolution of a corporation?

a. if the corporation commits fraud, fails to pay taxes, or commits another criminal offense
b. if the corporation fails to commence business operations
c. both A and B
d. none of the above

23. Alpha Corporation votes unanimously to dissolve. What, if anything, may the corporation still do?

a. hire new employees
b. pay debts
c. take out loans
d. both B and C

24. If a corporation elects a voluntary dissolution, who usually become the trustees of corporate assets?

a. no one
b. the board of directors
c. the corporate officers
d. the shareholders

25. If board members decide to serve as trustees, liquidation will be done _______________court supervision. If they decline to act as trustees, a(n) _______________ will be appointed to wind up corporate affairs.

a. with; receiver
b. with; executor
c. without; receiver
d. without; executor