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WAEC Commerce 1995 Question 83

Question 83

Business Combinations

A holding company exercises control over its subsidiaries by

  1. A.changing the administration completely
  2. B.becoming the principal customer
  3. C.increasing the number of workers
  4. D.owning majority of the shares
  5. E.paying off the debts
Show the answer and explanation

Answer: D (owning majority of the shares)

Explanation

A holding company controls subsidiaries by owning more than half of their voting shares.