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20 Cards in this Set

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The purchase if a company by another, larger firm, which absorbs the smaller company into its operations.
Acquisition
A group of individuals elected by a firm's shareholders and charged with overseeing, and taking legal responsibility for the firm's actions.
Board of Directors
Document in which the entrepreneur summarizes her or his business strategy for the proposed new venture and how that strategy will be implemented.
Business Plan
The person responsible for the firm's overall performance.
Chief executive officer
An organization that is formed to benefit its owners in the form or reduced prices and the distribution of surpluses at year-end.
Co-operative
Shares whose owners usually have last claim on the corporation's assets but have voting rights in the firm.
Common stock
A merger of two firms in completely unrelated businesses.
Conglomerate merger
A business considered by law to be a legal entity separate from its owners with many of the legal rights and priveledges of a person; a form of business organization in which the liability of the owners is limited to their investment in the firm.
Corporation
Occurs when a company sells part of its existing business operations to another company.
Divestiture
A corporation must pay taxes on its profits, and the shareholders must pay personal income taxes on the dividends they receive.
Double taxation
An arrangement whereby a corporation buys its own stock with loaned funds and holds it in trust for its employees.
ESOP employee stock ownership plan
A business person who accepts both the risks and the opportunities involved in creating and operating a new business venture.
Entrepreneur
An arrangement that gives the franchisees (buyers) the right to sell the product of the franchiser (the seller)
Franchise
Stipulates the duties and responsibilities of the franchisee and the franchiser.
Franchising agreement
An acquisition in which the management of the acquired company welcomes the firm's buyout by another company.
Friendly takeover
A partner who is actively involved in managing the firm and has unlimited liability.
General partner
A merger of two firms that have previously been direct competitors in the same industry.
Horizontal merger
An acquisition in which the management of the acquired company fights the firm's buyout by another company.
Hostile takeover
Selling shares of stock in a company for the first time to the general investing public.
IPO initial public offering
Members of the corporation's board of directors who are also full-time employess of the corporation.
Inside directors