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Up8
Which one of the following statements is least accurate regarding shareholder rights?
- A. Shareholders cannot vote without attending meetings.
- B. Cumulative voting gives small shareholders more rights.
- C. Shareholders do not like takeover defenses.
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Up1
The correct answer is A.
Shareholders can vote without attending meetings. Shareholders may vote at a meeting by attending in person but, in fact, most shareholders vote by “proxy” without being present in person.
Options B is correct. Cumulative voting is a type of voting system that helps strengthen the ability of minority shareholders to elect a director. This method allows shareholders to cast all of their votes for a single nominee for the board of directors when the company has multiple openings on its board.
Option C is correct. Takeovers benefit investors but threaten incumbent, inefficient management. As such, takeover defenses are not well perceived by shareholders.
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