CGExam3 - Your Name Your Email Exam 3 Corporate Governance...

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Your Name : Your Email : Exam 3: Corporate Governance Finc 732 3 December, 2007 The exam is closed book, closed notes. You may use a pen and pencil and a calculator. The exam last for the entire class period from 10:00AM to 11:15PM. You do not need to write more than 100 worlds to respond to any of these questions. In fact, all of my sample solutions are less than 75 words. If you write more than 100 words, I shall ignore all text after the 100th word. So, keep your answers concise. I have attached a sheet of formulae which you might (or might not) find useful. Any communication with other students during the test period, or consultation of notes or computers, is a violation of the Tulane and Freeman School Honor Code. I expect all of you to live up to the obligations you accepted when signing the Freeman Honor Code Pledge.
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Question 1 of 6 The case of LENS and Pioneer relates to (a) The increasing use of spectacles in by pioneers in the 1870s (b) A pension fund LENS (Louisiana Engineers and Nautical Society) attempting to eliminate dual class shares at Pioneer Holdings L.L.C. (c) A relationship investor LENS attempting to buy up the shares of an electronics firm Pioneer Electronics in order force them to drop its plans to expand into the retail clothing sales. (d) A relationship investor LENS attempting to intervene in the governance of Pioneer Group to unseat its board. Suggested Answer (d) 2 CGExam3.nb
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Question 2 of 6 Mr. Foetidus owns 3/5 or the company BonaAura, a maker of air purification systems. Bona- Aura owns 2/3 of the BodyElectric, a manufacturer of electric blankets. Foetidus, ostensibly because of his concern for the health of BodyElectric workers, arranges for the Body Electric to buy 100 Air Cleaners from BonaAura for $22,000.00/each. These air cleaner could be sold by BonaAura in the retail market for $5,000.00. (a) Assuming that these air cleaners have no value to the Body Electric, compute the effect of this transaction on the wealth of Foetidus (b) When we described, in class, activities such as those undertaken by Foetidus, we labelled these activities: (1) reaping, (2) accounting manipulation, (3) tunnelling, (4) dishonesty.
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  • Spring '08
  • Noe
  • Salary, Types of business entity, Mr. Bill, fixed salary

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