Which occurs when managers purchase all the shares in the business to become owners?

• A. Management Buy-Out
• B. Market Development
• C. Product Development
• D. Franchise

Answer: (A)

This question is about ownership change when managers take control by buying all the shares. When the management team purchases every share to become the owners, that is a management buy-out. It happens when those who run the business take full ownership from current owners, giving them decision-making power and control while continuing to operate the company. This differs from the other options: expanding into new markets (market development) and creating new products (product development) are growth strategies, not changes in ownership, and franchising involves licensing the business model to others to operate under the brand, not managers purchasing the business themselves.