Which One of the Following Statements Accurately Describes a Merger

question 15

Multiple Choice

Which one of the following statements accurately describes a merger?

• A) A merger transforms the target firm into a new entity which necessarily becomes a subsidiary of the acquiring firm
• B) A new firm is created from the assets and liabilities of the acquirer and target firms
• C) The acquiring firm absorbs only the assets of the target firm
• D) The target firm is absorbed entirely into the acquiring firm and ceases to exist as a separate legal entity.
• E) A new firm is created holding the assets and liabilities of the target firm and its former assets only.

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Definitions:

Category Extension

The strategy of using an established brand's name to enter a new product category or market segment, leveraging the brand's existing reputation and customer base.

Category Extension

The practice of expanding a brand or product line into new categories or markets, leveraging existing brand equity to introduce new offerings.

Co-branding

A partnership between two or more brands to create a product or service that leverages the strength of each brand's identity.