USA HISTORY

THE ROARING 20S 1920 1929

AMERICAN ECONOMY IN THE 1920S

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Corporations that own or control other companies by buying up their stock are called
A
monopolies.
B
holding companies.
C
associations.
D
trusts.
Explanation: 

Detailed explanation-1: -A holding company is one that individuals form for the purpose of purchasing and owning shares in other companies. By “holding” stock, the parent company gains the right to influence and control business decisions.

Detailed explanation-2: -A holding company is a parent company-usually a corporation or LLC-that is created to buy and control the ownership interests of other companies. The companies that are owned or controlled by a corporation holding company or an LLC holding company are called its subsidiaries.

Detailed explanation-3: -A holding company is a business entity-usually a corporation or limited liability company (LLC). Typically, a holding company doesn’t manufacture anything, sell any products or services, or conduct any other business operations. Rather, holding companies hold the controlling stock in other companies.

Detailed explanation-4: -Holding companies, which are sometimes called “parent companies, ” control the assets of other companies, known as subsidiaries.

Detailed explanation-5: -A subsidiary is a company that is owned or controlled by a parent or holding company. Usually, the parent company will own more than 50% of the subsidiary company. This gives the parent organization the controlling share of the subsidiary. In some cases, control can be achieved simply by being the majority shareholder.

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