Which of the Following Is an Advantage of Business Acquisition

question 3

Multiple Choice

Which of the following is an advantage of business acquisition?

• A) Considerable investment
• B) Information asymmetry
• C) Moral hazard
• D) Existing customer base

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Definitions:

Nash Equilibrium

A concept within game theory where no participant can gain by a unilateral change of strategy if the strategies of the others remain unchanged.

Profit-Maximizing

The process by which a firm determines the price and output level that returns the maximum profit.

Marginal Cost

The increase or decrease in the total cost that arises from producing one additional unit of a product.

Annual Fixed Cost

Expenses that do not change in proportion to the activity of a business, within the period of a year.