Aardvark Software,Inc

question 92

Multiple Choice

Aardvark Software,Inc.can purchase all the stock of Zebra Computer Services for $1,000,000 in cash.Zebra is expected to generate net after-tax cash flows of $100,000 per year for each of the next 10 years.Aardvark should:

• A) not purchase Zebra Computer Services.
• B) purchase Zebra Computer Services.
• C) purchase Zebra only if Aardvark's cost of capital is between 5% and 10%.
• D) purchase Zebra only if Aardvark's cost of capital is above 10%.

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Definitions:

Assertive Manner

A communication style characterized by confidently and clearly expressing one's thoughts, feelings, and needs without being aggressive.

Feedback

The transmission of evaluative or corrective information about an action, event, or process to the original source.

Emotionally Charged

Describes situations or issues that evoke strong emotional reactions.

Group Member

An individual who is part of a collective or team that works together towards common goals or participates in shared activities.