When Merging Two Organizations,a Separation Strategy Is Most Commonly Applied

question 77

Multiple Choice

When merging two organizations,a separation strategy is most commonly applied when:

• A)both companies have relatively weak cultures that are generally ineffective.
• B)one company has an effective culture and employees at the other company would embrace that culture if applied to them.
• C)the two organizations operate in distinct industries.
• D)the acquired firm's culture doesn't work,whereas the culture of the acquiring firm does work.
• E)a bicultural audit reveals that both companies have very similar cultures.

Understand the concept of financial ratios and their calculation.

Grasp the importance of the current ratio and working capital measurement in assessing a company's liquidity.

Comprehend the debt to total assets ratio for evaluating a company's solvency.

Identify the relevance of the price-earnings ratio in assessing a company's stock value.

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Definitions:

Trunk

The main body of a person or animal excluding the limbs and head; also refers to the main stem of a tree.

Ears

Organs of hearing and balance located on either side of the head.

Subtle Condition

A situation or state of being that is not immediately obvious or noticeable but may have significant implications or effects.

Not Apparent

A term used to describe something that is not visible or easily observable.