ABC CorpHas Offered 1 Million Shares Having a Total Market Value

question 12

Multiple Choice

ABC Corp.has offered 1 million shares having a total market value of $8 million for XYZ.After the merger is announced,shares in ABC trade for $7 each.If ABC is confident about XYZ's value,then the cost of the merger:

• A) increased by $1 million.
• B) decreased by $1 million.
• C) increased by $9 million.
• D) remained constant.

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Definitions:

Firm's Products

The goods and services that a company produces and offers to the market.

Technique

A particular method or way of doing something, often implying skillfulness and efficiency in performance or execution.

Enterprise Resource Planning

A type of software that organizations use to manage day-to-day business activities such as accounting, procurement, project management, and supply chain operations.

Ongoing Process

Describes a continuous operation or activity that is part of the regular functioning of a system or organization.