Which of the Following Statements Is Correct Concerning the Cost

question 14

Multiple Choice

Which of the following statements is correct concerning the cost of two firms merging? The cost:

• A) is fixed when the merger is financed with cash.
• B) can be affected by postmerger gains if cash is used.
• C) decreases as the postmerger share price increases when stock is used to finance the merger.
• D) is not determined until after the merger, regardless of the type of financing.

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Definitions:

Myelin Sheath

The fatty layer that surrounds and insulates the axons of some neurons, which enables faster transmission of electrical impulses.

Neurotransmitters

Chemicals that transmit signals across a synapse from one neuron to another neuron, muscle cell, or gland cell.

Synaptic Vesicle

Membrane-bound sacs in the presynaptic terminals of neurons that store neurotransmitters, which are released into the synaptic cleft in response to an action potential.

Axon

A long, slender projection of a nerve cell, or neuron, that conducts electrical impulses away from the neuron's cell body.