Which of the Following Statements Concerning Acquisitions Are Correct

question 21

Multiple Choice

Which of the following statements concerning acquisitions are correct?
I. Being acquired by another firm is an effective method of replacing senior management.
II. The net present value of an acquisition should have no bearing on whether or not the acquisition occurs.
III. Acquisitions are often relatively complex from an accounting and tax point of view.
IV. The value of a strategic fit is easy to estimate using discounted cash flow analysis.

• A) I and III only
• B) II and IV only
• C) I and IV only
• D) I, III, and IV only
• E) I, II, III, and IV

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Definitions:

Positive Reinforcement

A process in behavioral psychology where the introduction of a rewarding stimulus following a desired behavior increases the likelihood of that behavior occurring in the future.

Secondary Reinforcement

A stimulus that gains its reinforcing power through its association with a primary reinforcer, such as praise, tokens, or money.

Operant Conditioning

A technique in education where the potency of an action is transformed by the use of encouragements or punishments.

Classical Conditioning

A behavioral conditioning process where the continual pairing of two stimuli results in the first stimulus eventually eliciting a reaction initially brought about by the second stimulus.