In the paragraph below, a statement contains two pairs of terms enclosed in parentheses. Determine which term in each pair correctly completes the statement. Then select the answer choice containing the two terms that you have chosen. One type of acquisition is called a stock purchase. In a typical stock purchase, a company acquires (51% / 100%) of the voting shares of another company's stock, thereby making the acquired company a subsidiary. The (acquired / acquiring) company holds all of the assets and liabilities of the acquired company.

Question

Quizplus · Accepted Answer

In a typical stock purchase, the acquiring company acquires 100% of the voting shares of another company's stock, thereby making the acquired company a subsidiary. Therefore, the correct pair of terms to complete the first statement is "100%." In the second statement, the subject being referred to is the "acquiring company," which "holds all of the assets and liabilities of the acquired company." Therefore, the correct pair of terms to complete the second statement is "acquiring."

In the Paragraph Below, a Statement Contains Two Pairs of Terms