1. Consider a four-tier pyramid and a single operating company. Assume that 51 percent of the votes confer control at each tier. What is the minimum percentage ownership (approximately) at the highest level in the pyramid that will enable control of the operating company?

a. 13 percent

b. 50 percent

c. 51 percent

d. 26 percent

2. If capital markets are completely efficient, then the purchase or sale of any security at the prevailing market price is never a positive-NPV transaction.

a. True.

b. False.

3. A majority of research supports the theory that past stock movements can predict future asset prices.

a. True.

b. False.