A Merger for Diversification Is Unnecessary from the Perspective of Stockholders

question 31

True/False

A merger for diversification is unnecessary from the perspective of stockholders, because they can accomplish the same diversification by selling some of the acquirer's stock and buying some of the target's.

---

Definitions:

Polish Zloty

The currency of Poland, symbolized as PLN.

Direct Quotes

The exchange rate for foreign currencies quoted in units of the domestic currency per one unit of the foreign currency.

Direct Quote

A representation of the amount of foreign currency required to buy or sell one unit of the domestic currency in the foreign exchange markets.

Country C's Currency

The legal tender issued by a sovereign government or central authority of country C.