Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book
4th Edition
ISBN: 9780134083278
Author: Jonathan Berk, Peter DeMarzo
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 29, Problem 20P
Summary Introduction
To discuss: The way in which a controlling family can use a pyramidal control structure to benefit an expense of another shareholder.
Introduction:
A company whose ownership structure is arranged in the form a top-down chain of control is termed as pyramidal control structure.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
How do dominant shareholders expropriate minority shareholders?
How do the shareholders of an organization can encourage its manager to act in a way which is consistent with the objective of maximization of shareholders' wealth?
Is it ethical to concentrate only on shareholder wealth, or should stakeholders as a whole be considered?
Chapter 29 Solutions
Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book
Ch. 29.1 - Prob. 1CCCh. 29.1 - Prob. 2CCCh. 29.2 - Prob. 1CCCh. 29.2 - Prob. 2CCCh. 29.3 - What is the main reason for tying managers...Ch. 29.3 - Prob. 2CCCh. 29.4 - Prob. 1CCCh. 29.4 - Prob. 2CCCh. 29.5 - Prob. 1CCCh. 29.5 - Prob. 2CC
Ch. 29.5 - Prob. 3CCCh. 29.6 - Prob. 1CCCh. 29.6 - Prob. 2CCCh. 29 - Prob. 1PCh. 29 - Prob. 2PCh. 29 - Prob. 3PCh. 29 - Prob. 4PCh. 29 - Prob. 5PCh. 29 - Prob. 6PCh. 29 - Prob. 7PCh. 29 - Prob. 8PCh. 29 - Prob. 9PCh. 29 - Prob. 10PCh. 29 - Prob. 11PCh. 29 - Prob. 12PCh. 29 - Prob. 13PCh. 29 - Prob. 14PCh. 29 - Prob. 15PCh. 29 - Prob. 16PCh. 29 - Prob. 17PCh. 29 - Prob. 18PCh. 29 - Prob. 19PCh. 29 - Prob. 20P
Knowledge Booster
Similar questions
- What advantages does a sole proprietor offer? What is a major drawback of this type of organization?arrow_forwardWhat are some of the conflicts that can arise when a company is owned by group of shareholders but managed by a different group of people? How could you reduce the significance of these conflicts?arrow_forwardChoose one right of a shareholder and explain why this is important.arrow_forward
- How can a minority shareholder take action against the majority shareholders?arrow_forwardIdentify the conflict between the goal of shareholder wealth maximization and other stakeholder concerns (sometimes referred to as environmental, social, and governance (ESG) concerns).arrow_forwardWhat advantages does a company achieve when it possesses significant influence over another company through voting stock ownership?arrow_forward
- Is the Strategic Stakeholder model of Corporate Social Responsibility closer to the Shareholder model or the Multifiduciary Stakeholder model? Explain all three models and provide justification for your answer. Please explain brieflyarrow_forwardEvaluate the similarities and differences between trusts and corporations. In an attempt to protect income, which would be most suitable for a company?arrow_forwardWhat are agency problems, and why do they exist within a corporation? Discuss how agency conflicts affect the goal of maximizing shareholder value.arrow_forward
- how does the existence market for corporate control affect firm performance?arrow_forwardExplain how principal-agent problems can emerge within shareholder firms and some of the consequences of these problemsarrow_forwardExplain the Threat and Opportunity of Shareholder Activism ? Explain the Effect of Executive Compensation on the Cost of Equity? Why Corporate Governance Is Important to Investors?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage LearningBusiness/Professional Ethics Directors/Executives...AccountingISBN:9781337485913Author:BROOKSPublisher:CengagePrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
- EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
Business/Professional Ethics Directors/Executives...
Accounting
ISBN:9781337485913
Author:BROOKS
Publisher:Cengage
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT