In a Merger The

question 4

Multiple Choice

In a merger the:

• A) Legal status of both the acquiring firm and the target firm is terminated.
• B) Acquiring firm retains its name and legal status.
• C) Acquiring firm acquires the assets but not the liabilities of the target firm.
• D) stockholders of the target firm have little, if any, say as to whether or not the merger
• E) Target firm continues to exist as a subsidiary of the acquiring firm.

Learn how the sales mix impacts the overall break-even point for a company.

Grasp the calculation and significance of the contribution margin and contribution margin ratio.

Understand how fixed and variable expenses affect a company’s profitability and break-even point.

Calculate the degree of operating leverage and interpret its effects on a company’s operating income.

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Definitions:

Vault Cash

The physical currency a bank holds in its vault as part of its required reserves or for daily operations.

Monetary Policy

Central bank policies aimed at influencing economic activities through controlling interest rates and supply of money.

Reserve Requirement

The Reserve Requirement is a central banking regulation that sets the minimum amount of reserves each bank must hold as a proportion of its deposits, a tool used to control the money supply.

Open Market Operations

Activities by a central bank to buy or sell government securities in the open market to influence the money supply and interest rates.