A Combination in Which All of the Combining Companies Are

question 4

Multiple Choice

A combination in which all of the combining companies are dissolved and a new firm is formed is known as a ____.

• A) holding company
• B) leveraged buyout
• C) consolidation
• D) composition

---

Definitions:

Price-Earnings Ratio

A valuation metric that measures a company's current share price relative to its per-share earnings, indicating investor expectations.

Net Income

The amount of profit a company generates after deducting all its costs, expenses, taxes, and interest from its total revenue.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Payout Ratio

A financial metric indicating the percentage of earnings paid to shareholders in the form of dividends, reflecting a company's dividend sustainability.