Consider the Following Two Statements: (I) Event Studies Show That

question 18

Multiple Choice

Consider the following two statements: (i) Event studies show that returns on the buyer's equity are positive around the time of the
Announcement of sale, suggesting that sell-offs create value to the buyer.
(ii) Event studies show that acquisitions are often sold off down the road.

• A)(i) is correct, (ii) is incorrect.
• B)(ii) is correct, (i) is incorrect.
• C)Both (i) and (ii) are correct.
• D)Both (i) and (ii) are incorrect.
• E)None of the above.

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Definitions:

Logarithm

The exponent that a base, typically 10 or e, needs to be elevated to in order to generate a specific number.

Graph

A visual representation of data, functions, or equations, typically plotted with an x and y axis.

Natural Logarithm

The logarithm to the base e, where e is an irrational and transcendental number approximately equal to 2.71828.

Graph

An image that demonstrates the system of interactions or affiliations among two or more entities by employing distinctive visual tools such as dots, lines, and bars.