The Bidder in a Takeover Generally Should Take Advantage of Temporary

question 16

Multiple Choice

The bidder in a takeover generally should take advantage of temporary anonymity to purchase shares of the target before its intentions are publicly known and the target firm's price rises.Such initial purchases establish a _______.

• A)foothold
• B)leghold
• C)armhold
• D)toehold

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Definitions:

Support Department Allocations

The process of distributing overhead costs from support departments to producing departments based on predetermined criteria.

Operating Income

is the profit realized from a business's operations after deducting operating expenses such as wages and depreciation, but before interest and taxes.

Residual Income

Residual income is the amount of net income generated beyond the minimum return expected by an entity or on an investment, often used as a measure of corporate and individual performance.

Return on Investment

A measure used to evaluate the efficiency or profitability of an investment, calculated as return divided by the cost of the investment.