In a Merger or Acquisition, a Firm Should Be Acquired

question 34

Multiple Choice

In a merger or acquisition, a firm should be acquired if:

• A) it generates a positive net present value to the shareholders of an acquiring firm.
• B) it is a firm in the same line of business, in which the acquirer has expertise.
• C) it is a firm in a totally different line of business which will diversify the firm.
• D) it pays a large dividend which will provide cash pass through to the acquirer.

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Definitions:

Personal Power

Power that is associated with admiration by others, which comes from such attributes as strength of character, passion, inspiration, or wisdom.

Position Power

Power that is related to the authority associated with a role or title and includes the power to manage people or command resources.

Informal Leader

A person who influences others within an organization or group without having a formal authority or position.

Staff Nurse

A registered nurse who provides patient care and support in hospitals, clinics, and other healthcare facilities.