Consider the Following Equation: < the Term

question 55

Multiple Choice

Consider the following equation: < The term x in this equation refers to:

• A)the value of the synergies created by the merger.
• B)the premerger,or standalone,value of the acquirer.
• C)the number of new shares to pay for the target.
• D)the premerger (standalone)value of the target.

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Definitions:

Return

The profit or loss derived from an investment over a particular period, often expressed as a percentage of the investment's initial cost.

Inflation

The velocity of rise in the aggregate pricing of goods and services, reducing the power of the dollar.

Dividends

Regular payments declared by a company's board of directors and given to its shareholders from the company's earnings.