A formal proposal to purchase a given number of shares of a firm's stock at a specified price is a
A) warrant.
B) stock purchase option.
C) right.
D) tender offer.

Question

Quizplus · Accepted Answer

A formal proposal to purchase a given number of shares of a firm's stock at a specified price is called a tender offer. A warrant is a contract that gives the holder the option to buy or sell a stock at a certain price before a specific date. A stock purchase option is similar to a warrant but is typically given to employees as part of their compensation. A right is a type of shareholder privilege to purchase additional shares at a discount.

A Formal Proposal to Purchase a Given Number of Shares