Question

The voting proportion required to enable a corporation to invest its fund in any other corporation or business or for any purpose other than its primary purpose

A. 2/3 vote of the board of directors and ratified by majority of the outstanding capital stock
B. Majority vote of the board of directors and ratified by majority of the outstanding capital stock
C. Majority vote of the board of directors and ratified by 2/3 of the outstanding capital stock
D. Majority vote of the board of directors and ratified by 2/3 of the stockholders

Answer 1

The correct voting proportion required for a corporation to invest its funds in another corporation or business or for any purpose other than its primary purpose is a majority vote of the board of directors, and it must be ratified by 2/3 of the stockholders.

Step-by-step explanation:

The correct answer is D. Majority vote of the board of directors and ratified by 2/3 of the stockholders.

In a corporation, decisions on investing funds in other corporations or businesses or for any purpose other than the corporation's primary purpose are typically made by the board of directors. To enable such investments, a majority vote from the board of directors is required. However, this decision also needs to be ratified by a supermajority of the stockholders, specifically 2/3 of the stockholders.

For example, if a corporation has 100 stockholders, at least 67 of them (2/3) need to ratify the decision made by the board of directors through a vote.