BUS 250 - CHAPTER 34 QUESTIONS WITH VERIFIED
ANSWERS
T/F: A public offer to buy a block of stock directly from shareholders is called a tender
offer. - Answers - true
Which of the following statements is correct with respect to state efforts to offer
protection to companies targeted for hostile takeovers?
a. Courts offer the only legal protection to companies targeted for hostile takeovers.
b. Statutory law offers the only legal protection to companies.
c. Both statutory law and the state courts have provided some degree of protection for
companies.
d. State courts and state statutes have offered no protection for companies targeted for
hostile takeovers. - Answers - Both statutory law and the state courts have provided
some degree of protection for companies.
The Williams Act - Answers - is designed to regulate the conduct of those attempting to
take over a company.
T/F: Tender offers are regulated on the federal level by the National Labor Relations
Act. - Answers - false
T/F: A director violates the corporate opportunity doctrine if he or she competes with the
corporation, unless the disinterested directors approve of the director's actions. -
Answers - true
Amy is on the board of directors of Computers Plus. Computers Plus is looking for a
warehouse to purchase. Amy owns a warehouse. In order for Amy to sell her
warehouse to Computers Plus - Answers - the disinterested members of the board of
directors must approve the transaction.
T/F: A speculator plans to acquire control of Kelp Corporation and then resell it at a
profit. A speculator is sometimes known as a corporate raider. - Answers - true
Which of the following is correct concerning anti-takeover efforts?
a. Most states have passed laws to deter hostile takeovers, but these statutes have not
totally eliminated hostile takeovers.
b. The Williams Act has been the most effective legislation in regulating of the actions
of the target company.
c. Federal statutes have been more effective than state statutes in eliminating hostile
corporate takeovers.
d. The most effective federal statute has been the Poison Pill Act. - Answers - Most
states have passed laws to deter hostile takeovers, but these statutes have not totally
eliminated hostile takeovers.
ANSWERS
T/F: A public offer to buy a block of stock directly from shareholders is called a tender
offer. - Answers - true
Which of the following statements is correct with respect to state efforts to offer
protection to companies targeted for hostile takeovers?
a. Courts offer the only legal protection to companies targeted for hostile takeovers.
b. Statutory law offers the only legal protection to companies.
c. Both statutory law and the state courts have provided some degree of protection for
companies.
d. State courts and state statutes have offered no protection for companies targeted for
hostile takeovers. - Answers - Both statutory law and the state courts have provided
some degree of protection for companies.
The Williams Act - Answers - is designed to regulate the conduct of those attempting to
take over a company.
T/F: Tender offers are regulated on the federal level by the National Labor Relations
Act. - Answers - false
T/F: A director violates the corporate opportunity doctrine if he or she competes with the
corporation, unless the disinterested directors approve of the director's actions. -
Answers - true
Amy is on the board of directors of Computers Plus. Computers Plus is looking for a
warehouse to purchase. Amy owns a warehouse. In order for Amy to sell her
warehouse to Computers Plus - Answers - the disinterested members of the board of
directors must approve the transaction.
T/F: A speculator plans to acquire control of Kelp Corporation and then resell it at a
profit. A speculator is sometimes known as a corporate raider. - Answers - true
Which of the following is correct concerning anti-takeover efforts?
a. Most states have passed laws to deter hostile takeovers, but these statutes have not
totally eliminated hostile takeovers.
b. The Williams Act has been the most effective legislation in regulating of the actions
of the target company.
c. Federal statutes have been more effective than state statutes in eliminating hostile
corporate takeovers.
d. The most effective federal statute has been the Poison Pill Act. - Answers - Most
states have passed laws to deter hostile takeovers, but these statutes have not totally
eliminated hostile takeovers.
