According to the Free-Cash-Flow Theory of Takeovers,postmerger Gains in Market

question 95

Multiple Choice

According to the free-cash-flow theory of takeovers,postmerger gains in market value represent:

• A) an illogical assessment of earnings prospects.
• B) the remaining costs of the merger.
• C) the present value of free cash flow that will no longer be misused.
• D) losses experienced by arbitrageurs and other speculators.

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Definitions:

Density-independent Factors

Environmental factors that affect the size of a population regardless of the population density, such as weather and natural disasters.

Abiotic

Non-living chemical and physical parts of the environment that affect living organisms and the functioning of ecosystems.

Interspecific Competition

The interaction between members of different species that vie for the same resource in an ecosystem (e.g., food or living space).

Intraspecific Competition

The interaction between members of the same species that vie for the same resource in an ecosystem (e.g., food or living space).