Which of the Following Is Likely to Happen When a Private

question 22

Multiple Choice

Which of the following is likely to happen when a private equity group hires an efficiency expert?

• A)Overburdening people by removing machines
• B)Modifying production processes to support excess inventories
• C)Increasing the number of employees involved in a particular task
• D)Limiting procedures that streamline operations
• E)Decreasing movements that create no value

---

Definitions:

Book Value

The value of a company's assets as recorded in its financial statements, minus the company's total liabilities and intangible assets such as goodwill.

Goodwill

An intangible asset that arises when a buyer acquires an existing business and pays a price higher than the fair value of the identifiable tangible and intangible assets.

Merger Transaction

A corporate action where two or more companies are consolidated into one entity, often to enhance competitiveness or grow market share.

Accounts Payable

Liabilities owed by a company to creditors or suppliers for goods and services received but not yet paid for.