The Downsides or Limitations of Mergers and Acquisitions Include All

question 96

Multiple Choice

The downsides or limitations of mergers and acquisitions include all of the following except

• A) It is a slow means to enter new markets and acquire skills and competences.
• B) Difficulties exist in integrating the activities and resources of the acquired firm into ongoing operations.
• C) There can be many cultural issues that can doom an otherwise promising acquisition.
• D) Premiums that are frequently paid to acquire a business are large.

---

Definitions:

Fair Value

A reasonable estimate of the price for goods, services, or assets if sold in the market under current conditions.

Unrealized Loss Account

A financial account that tracks the losses on investments or assets not yet sold, representing a decrease in value.

Stockholders' Equity

Stockholders' Equity is the residual interest in the assets of a corporation after deducting its liabilities, indicating the ownership interest of the shareholders.

Trading Portfolio

A collection of financial assets such as stocks, bonds, commodities, currencies, and derivatives, actively managed and traded to achieve short-term financial gains.