Module 11 (2)

Question 1

Can the three types of people in a corporation overlap?

Answer 1

Yes they can, usually in smaller companies
eg. a shareholder might vote themeslves on to the board of directors

Question 2

What is an example of a cooperative

Answer 2

A grocery co-op that provides a grocery store to an area that is a food desert

An energy co-op may provide electricity to members that comes froma sustainable source

Question 3

What is the theory for shareholders

Answer 3

Those who have invested more, are entitled to get more back

Question 4

What does it mean when a co-op makes a profit?

Answer 4

If it makes a profit, it means that it has overcharged its members and needs to return some of the profit

Question 5

What happens to a corporation when its wound down?

Answer 5

The shareholders have a right to share in the leftover value of a business (residual claim)

Question 6

Are members allowed to share in the leftover value (residual claims) of the co-op is wound down ?

Answer 6

Depends on the province, if not, the money is given to another like-minded cooperative

Question 7

Each member gets ___ vote per share on decisions, no matter how much business they have done with the cooperative

Answer 7

One

Question 8

_______ governance is valued in a coop

Answer 8

democratic

Question 9

The owners of the two businesses (shareholders and members) elect the directors to oversee the business, why is this a risk?

Answer 9

The directors might act in self-interested ways
eg. paying big bonuses to themselves