Which One of These Statements Is True

question 37

Multiple Choice

Which one of these statements is true?

• A)One disadvantage of a merger is that it requires the approval of both the target and bidder firm's shareholders.
• B)Normally,the target firm's management is very cooperative during the merger process.
• C)A consolidation is a complete absorption of a target firm by a bidder firm,which retains its name and identity.
• D)An entirely new firm is created when any type of merger or consolidation occurs.
• E)Mergers are legally complex and expensive.

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Definitions:

Cash Dividend

A payment made by a corporation to its shareholders, usually in the form of cash, based on the number of shares they own.

Report Income

The act of documenting and declaring earned income within a specific period for tax and accounting purposes.

Cash Surrender Value

The amount of cash that an insurance policyholder can receive upon cancelling the policy before its maturity or an insured event occurs.

Insurance Policy

A contract between an insurance policyholder and an insurer, outlining the claims which the insurer is legally required to pay in exchange for an initial payment, known as a premium.