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A and B are two competing companies. An investor decides whether to buy

(a) 100 shares of A, or
(b) 100 shares of B, or
(c) 50 shares of A and 50 shares of B.

1 Answer

3 votes

Final answer:

At least four additional investors are required to vote to change the top management. Investors 1 and 2 can have influence but not be certain of always getting their way.

Step-by-step explanation:

The minimum number of investors it would take to vote to change the company's top management can be determined by finding the total number of shares that investors other than 1 and 2 own. These investors own a total of 15,000 shares. So, at least 15,001 shares are required to vote to change the top management. Since each investor owns 5,000 shares (investors 6 through 11), it would take a minimum of 4 additional investors to reach 15,001 shares.

If investors 1 and 2 agree to vote together, they can have a significant influence, but they cannot be certain of always getting their way. To be certain of always getting their way, they would need to have 50% + 1 of the total shares. In this case, that would be 50,001 shares. As investors 1 and 2 together only have 38,000 shares, they would still need the support of other investors to have a majority.

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