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Veronica holds 51% of the shares of NextGuard, Inc. What type of voting would allow Veronica...

Veronica holds 51% of the shares of NextGuard, Inc. What type of voting would allow Veronica to dominate the corporation?

  1. Preferred
  2. Cumulative
  3. Straight
  4. Ranked
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Answer #1

Option B

  • Cumulative type of voting would allow Veronica to dominate the corporation.
  • Cumulative voting is preferred when some of the share holders of a particular organization hold proportionately more number of shares than the other share holders.
  • Cumulative voting is also called as proportional voting as each share holder can vote the number of times on the number of shares they hold. This allows the share holders to dedicate their complete votes to a single candidate in an organisation.
  • This will lead to the dominance of a particular candidate in an organisation.
  • Hence as Veronica holds 51% of the shares of Next Guard Inc, cumulative voting allows her to dominate the corporation.
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