If a Firm Generates Excessive Debt After an Acquisition, Credit

question 2

Multiple Choice

If a firm generates excessive debt after an acquisition, credit rating agencies will reduce its credit rating. This reflects the fact that the firm

• A) is likely to become an acquisition target itself.
• B) did not perform adequate due diligence before the acquisition.
• C) has become overdiversified.
• D) is a riskier investment.

---

Definitions:

Work Well

The effectiveness and efficiency with which tasks are completed or objectives are met, often in a team or workplace setting.

Fit In

The act of assimilating or adapting to a group or environment so as to be accepted or comfortable within it.

Unhappy People

Individuals experiencing a persistent state of sadness or dissatisfaction with their lives or circumstances.

Conflict Resolution

The process of resolving a dispute or disagreement between parties in a constructive and peaceful manner.