Which of the Following Is Not True About Why Firms

question 96

Multiple Choice

Which of the following is not true about why firms prefer to acquire existing assets rather than undertake greenfield investments?

• A) Foreign firms are acquired because those firms have valuable strategic assets.
• B) Firms make acquisitions because they believe they can increase the efficiency of the acquired unit by transferring capital, technology, or management skills.
• C) Firms make acquisitions because they believe it will make more profits for the home firm and home country.
• D) Mergers and acquisitions are quicker to execute than greenfield investments.
• E) Mergers and acquisitions are cheaper than greenfield investments.

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Definitions:

Motivation

The reason or reasons one has for acting or behaving in a particular way; an internal process that makes a person move toward a goal.

Performance

The act of executing a task or function, often measured against predefined standards.

Goal Specificity

The extent to which a goal is detailed, explicit, and clear as opposed to vague or general.

Expectancy

The belief or anticipation of the likelihood that something will occur, often related to motivation theory.