Which of the following describes an employee buyout?
A) The firm's employees borrow money against their own assets, such as their houses or their pension funds, to purchase the firm from its present owners.
B) The firm's employees vote to replace the board of directors with proxies of their own choosing.
C) The firm's employees sell shares of their stock to the highest bidder in exchange for proxy votes of the board of directors.
D) The employees of the firm in danger of being purchased by an unwanted company quickly find a more acceptable buyer for the company.
E) The employees of the firm in danger of being purchased by an unwanted company borrow money against their own assets to purchase the unwanted company.
Answer: A
Explanation: A) An employee buyout is when employees borrow against their own assets to create an employee-owned firm.
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