In the Case of a Merger That Is Stock Financed

question 18

Multiple Choice

In the case of a merger that is stock financed, the assumed merger cost may be incorrect if the:

• A) value of the acquired firm's shares changes after the merger announcement.
• B) value of the acquiring firm's shares changes after the merger announcement.
• C) long-term interest rates increase.
• D)merger is either horizontal or vertical.

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Definitions:

Immunity

The body's ability to resist or fight off infection, disease, or other unwanted biological invasion.

Thrombocytopenia

Condition in which there is an abnormally small number of platelets in the blood.

Prothrombinase

An enzyme complex involved in the blood clotting process that converts prothrombin to thrombin.

Prothrombin

A protein present in blood plasma that is converted into active thrombin during coagulation.