The Firm in a Merger Transaction That Is Being Pursued

question 29

Multiple Choice

The firm in a merger transaction that is being pursued as a takeover potential is called the

• A) conglomerate.
• B) holding company.
• C) acquiring company.
• D) target company.

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Definitions:

Lease Financing

A method of financing where a firm obtains the use of certain assets through leasing, avoiding the need to invest capital in them.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or investment.

Foregone CCA

The term "Foregone CCA" does not exist in widely recognized financial lexicons and might be incorrectly stated or highly specific to a niche sector.

Tax Shield

The reduction in income taxes that results from taking allowable deductions from taxable income, such as interest on debt.