The Use of High Levels of Debt in Acquisitions Has

question 78

Multiple Choice

The use of high levels of debt in acquisitions has contributed to:

• A) the increase in above-average returns earned by acquiring firms.
• B) an increased risk of bankruptcy.
• C) the negative returns earned by both firms.
• D) an increase in investments that have long-term payoffs and reduced firm competitiveness.

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Definitions:

Industrial Countries

Nations with highly developed industries and infrastructure, often characterized by significant levels of manufacturing, services, and technology sectors.

Developing Countries

Nations with lower levels of industrialization, lower living standards, and often lower Human Development Index (HDI) scores compared to developed countries.

Standard Of Living

The level of wealth, comfort, material goods, and necessities available to a person, group, or society.

Per Capita Income

A measure of the average income earned per person in a given area or country.