Which One of the Following Statements Is Correct

question 120

Multiple Choice

Which one of the following statements is correct?

• A) If an acquisition is made with cash then the cost of that acquisition is dependent upon the acquisition gains.
• B) Acquisitions made by exchanging shares of stock are normally taxable transactions.
• C) The management of an acquiring firm may put itself at risk of losing control of the firm if they do acquisitions using shares of stock.
• D) The stockholders of the acquiring firm will be better off when an acquisition results in losses if the acquisition was made with cash rather than with stock.
• E) Acquisitions based on legitimate business purposes are not taxable transactions regardless of the means of financing used.

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Definitions:

Schedules of Reinforcement

The strategy or pattern in which rewards or punishments are given to encourage or discourage behavior.

Punishing Contingency

An approach in management or behavioral psychology where negative consequences are applied to reduce or eliminate undesirable behavior.

Operant Conditioning

A training technique where the vigor of a conduct is adjusted by the use of reinforcements or sanctions.

Classical

Relating to traditional concepts, styles, or methods that have been established over a long period.