The "Bootstrap Game" Is Played Somewhat in Defiance of Traditional

question 26

Multiple Choice

The "Bootstrap Game" is played somewhat in defiance of traditional merger logic in that it:

• A) provides immediate benefit through improved management.
• B) does not offer a positive NPV from the merger.
• C) stays in effect only until EPS are increased.
• D) does not require the approval of a majority of shareholders.

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Definitions:

Cognitive Dissonance

Feelings of discomfort resulting from holding contradictory beliefs, ideas, or values at the same time in one's mind.

Attitudes

Mental and emotional entities that inherit positive or negative evaluations of objects, people, or events, influencing an individual's behavior.

Actions

The things that an individual does, often in response to external stimuli or internal decisions.

Cognitive Dissonance

The psychological discomfort experienced by an individual who holds two or more contradictory beliefs, values, or ideas simultaneously.