Why Is It Not Sufficient to State That a Merger

question 107

Multiple Choice

Why is it not sufficient to state that a merger should occur simply because the economic gains are positive?

• A) Gains are typically of an accounting nature.
• B) Shareholders of the target may capture all gains.
• C) Merger cost should be negative after discounting.
• D) The merger's gain must also exceed its NPV.

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Definitions:

Poor

Individuals or populations that lack financial resources and essentials for a minimum standard of living.

Poverty Line

The minimum level of income deemed necessary to achieve an adequate standard of living in a given country, used to identify those living in poverty.

Welfare

Welfare refers to government programs designed to support the well-being of its citizens, especially those in financial need.

Poverty Line

A defined level of income that is considered the minimum necessary to maintain a standard of living.