Freedom Energy Group (Scenario)

question 56

Multiple Choice

Freedom Energy Group (Scenario)
Freedom Energy Group (FEG) is a major American energy services group based in Oklahoma. FEG manufactures products to facilitate oil and gas exploration and is involved in the construction of oil refineries and gas pipelines around the world. FEG managers are considering the purchase of a Canadian energy firm, Maple Leaf Energy, which manufactures pipeline stabilization products. The financial management division of FEG is considering the risks and benefits of purchasing Maple Leaf.
-Which of the following questions would be more important for FEG financial managers to evaluate before the firm purchases Maple Leaf?

• A) What is the anticipated impact of hybrid technology and alternative fuel sources on the gas and oil industry?
• B) Should FEG continue to employ Maple Leaf personnel after the acquisition, or should they be given severance packages?
• C) What type of global marketing package should be created to inform potential customers about FEG's purchase of Maple Leaf?
• D) What mix of debt and equity financing should FEG employ in the purchase and ownership of Maple Leaf?

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Definitions:

Internal Thought

The process of thinking that occurs within an individual's mind without external verbalization, involving various cognitive functions such as reasoning, remembering, and problem-solving.

Intermodal Perception

The process of combining information from more than one sensory system, such as visual and auditory senses.

Working Memory

A cognitive system responsible for temporarily holding information available for processing.

Focus

The concentration of attention or energy on something specific.