Which of the Following Statements Is FALSE

question 15

Multiple Choice

Which of the following statements is FALSE?

• A)In practice,most acquirers pay a substantial acquisition premium,which is the percentage difference between the acquisition price and the premerger price of the target firm.
• B)When a bid is announced,the target shareholders enjoy a gain of 15% on average in their stock price.
• C)In most U.S.states,the law requires that when existing shareholders of a target firm are forced to sell their shares,they receive the market price for their shares.In most cases,this concept is interpreted as the value inclusive of any value that arises because of the merger itself.
• D)A bidder is unlikely to acquire a target company for less than its current market value.

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Definitions:

Large Companies

These are corporations that have a significant market capitalization, often characterized by a large workforce, extensive product lines, and international operations.

Managerial Accounting

The use of accounting techniques to provide information designed to assist managers in making decisions about the business.

Production Shift Data

Information regarding the output, workforce, and operations during a specific work shift in production.

Performance Targets

Levels or rates of improvement that management wants to achieve for performance metrics.