A Leading Software Company Merged with Its Competitor to Form

question 3

Multiple Choice

A leading software company merged with its competitor to form a new company. Which of the following is likely to be the result of this merger?

• A) Decreased cost per unit output
• B) Decreased bargaining power over suppliers and customers
• C) Increased industry rivalry
• D) Decreased profitability
• E) Decreased product differentiation

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Definitions:

Dividend Declared

The action by a company's board of directors to distribute a portion of the earnings to shareholders, specified as an amount per share.

Originally Issued

Pertains to securities or stocks that have been made available for sale to the public for the first time.

Par-Common Stock

The face value of a share of common stock as designated in the corporate charter.

Paid-In Capital

Money that investors have given to a corporation in exchange for equity, representing the capital contribution from shareholders when issuing and selling shares.