If an Acquisition Does Not Create Value, Then The

question 138

Multiple Choice

If an acquisition does not create value, then the:

• A) Earnings per share of the acquiring firm must be the same both before and after the acquisition.
• B) Earnings per share can change but the stock price of the acquiring firm should remain constant.
• C) Price per share of the acquiring firm should increase because of the growth of the firm.
• D) Earnings per share will most likely increase while the price-earnings ratio remains constant.
• E) Price-earnings ratio should remain constant regardless of any changes in the earnings per share.

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Definitions:

Jeffersonian Republicans

A political ideology from the early United States advocating for limited federal government and agrarian democracy, associated with Thomas Jefferson.

National Government

The centralized political authority that governs an entire nation, as opposed to local or regional levels of government.

Incumbent

The current holder of a political office or position.

Micro-Targeting

A marketing strategy that uses consumer data and demographics to identify the interests of specific groups, often used in politics to tailor messages to narrow audience segments.