Principles of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
12th Edition
ISBN: 9781259144387
Author: Richard A Brealey, Stewart C Myers, Franklin Allen
Publisher: McGraw-Hill Education
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Question
Chapter 14, Problem 10PS
a)
Summary Introduction
To compute: The number of shares required to vote for at least one director in case of firm has majority voting.
b)
Summary Introduction
To compute: The number of shares required to vote for at least one director in case of firm has cumulative voting.
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Students have asked these similar questions
You want a seat on the board of directors of Four Keys, Incorporated. The company has 220,000 shares of stock outstanding and the stock sells for $69 per share. There are currently 5 seats up for election. If the company uses cumulative voting, how many shares do you need to guarantee that you will be elected to the board? Multiple Choice 33,001 shares 73, 334 shares 110,001 shares 36, 668 shares 44,000 shares
Given that there are 4,000,000 shares outstanding in Miller Corp., how many shares will be required for a minority group of stockholders to elect two of the nine members on the board of directors? (Assume cumulative voting is required.)
A. 888,889
B. 1,090,910
C. 800,001
D. 1,000,001
Suppose, you own 2,000 shares in a company with 5,000 shares outstanding. There are 8 directors up for election via cumulative voting. How many directors can you elect?" 3 2 1 5 4
Chapter 14 Solutions
Principles of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
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- Rho Corp is electing three director its board using cumulative voting. There are one million shares outstanding. How many shares must you own to get onboard as a director? A. 100,001 B. 250,000 C. 250,001 D. 333,334 E. 333,335arrow_forwardYou want a seat on the board of directors of Four Keys, Incorporated. The company has 200,000 shares of stock outstanding and the stock sells for $69 per share. There are currently 5 seats up for election. The company uses straight voting. How many shares do you need to guarantee that you will be elected to the board? Multiple Choice 90,001 shares 100, 001 shares 66, 668 shares 40, 000 sharesarrow_forwardIf cumulative voting is permitted: A. the total number of votes a shareholder has is equal to the number of shares owned. B. the total number of votes a shareholder has is equal to the number of shares owned times the average number of years the shareholder has owned the shares. C. the total number of votes a shareholder has can be calculated as the number of shares owned times the number of directors to be elected. D. the total number of votes a shareholder has is equal to the number of shares times the number of board meetings the shareholder has attended. E. None of these.arrow_forward
- Hi, I need help with this multiple-choice question. Thanks!arrow_forwardThere are 3 directors seats up for election. If you own 1,000 shares of stock and you can cast 3,000 votes for a particular director, this is illustrative of:a. multiple voting.b. sequential voting.c. absolute priority voting. d. cumulative voting. e. straight voting. choose onearrow_forwardYou want a seat oin the board of directors of Four Keys. Inc. The company hase 290000 shares of stocks outstanding and the stock sells for $61 per share. There are currently 4 seats up for election. If the company uses cumulative voting, how many shares do you need to guarantee that you will be elected to the board?arrow_forward
- Stockholder Z what to be elected as a director in the corporation. However, he has only at least 10,000 shares, which is equivalent to 10,000 votes. He needs at least 20,000 votes to get the highest number of votes. As the financial adviser of Z, what will be your advice. Explainarrow_forwardSharpe Products has one million outstanding shares and seven directors to be elected. Cumulonimbus Holdings owns 200,000 shares of Sharpe. How many directors can Cumulonimbus elect with cumulative voting? Group of answer choices 0 3 2 1arrow_forward63. XYZ is a stock corporation that wishes to elect 15 directors. stockholder C, owns 5,000 shares of stock in XYZ corporation. Apply the formula used in the casting of votes to determine the amount of shares that stockholder C can cast during the election. * A. C is entitled to 5,000 shares. B. C is entitled to 75,000 shares C. C is entitled to 750,000 sharesarrow_forward
- 64. The manner of voting in the election of the Board of Directors in a stock corporation may be done through: * A. Straight Voting Only B. Cumulative Voting Only C. Straight or Cumulative Voting at the option of the Stockholder D. Straight Voting if the stockholder owns up to 5,000 shares of stocks E. Cumulative Voting if the stockholder owns up to 50,000 shares of stockarrow_forward65. XYZ is a stock corporation that wishes to elect 12 directors. Stockholder C, owns 10,000 shares out of 50,000 outstanding shares of XYZ corporation. Now, Stockholder C intends to know whether his shares of stocks are enough to secure the two slots of his desired directors to run said corporation. Is the shares of stocks owned by Stockholder C sufficient? A. Yes. Since Stockholder C own 10,000 shares out of the 50,000 outstanding shares of XYZ Corporation. Therefore, he can cast 5,000 shares each to his two desired directors to form part of XYZ's Board of Directors. B.No. Since Stockholder C owns 10,000 shares out of the 50,000 outstanding shares of XYZ Corporation, his share is insufficient to secure two slots of his desired directors. Hence, with the shares of stock he owns, he may only secure one slot in the Board of Directors to run XYZ Corporation.arrow_forwardTypes of common stock In some cases, individuals who start a business have special voting rights that help them exercise more control over the firm. They own a special class of stock called (dual, founder) shares. Consider this case: The CEO of EchoStar Communications, Charlie Ergen, owned around 5% of the company’s stock, but his multiple votes per share gave him around 90% of the vote. Source: “Dish Network 2010 Annual Report,” on Dish Network Investor Relations, http://files.shareholder.com/downloads/DISH/1330128565x0x480914/DC45515A-D65F-475D-B6C2-CF83AE7A10D6/DISH_-_Web_Posting_-_3.30.11.pdf. Based on this example, which of the following statements is true? A. Classified shares are not issued with the purpose of providing super voting rights to a certain class of investors. B. Classified shares have super voting rights, which give more control to a certain class of investors.arrow_forward
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