Small Positive or Negative Returns to Acquiring-Company Shareholders May Be

question 24

Multiple Choice

Small positive or negative returns to acquiring-company shareholders may be explained by:

• A)tax loss benefits of a target.
• B)perceived cost reductions due to economies of scale in operations.
• C)perceived benefit of the method of financing the takeover to reduce agency costs.
• D)the over-confidence of acquiring-company management in their ability to value other companies.

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Definitions:

General Fund

The primary operating fund of a governmental entity, covering most basic services like police, fire, sanitation, and general administration.

Capital Projects Fund

Capital Projects Fund is a type of government accounting fund used to track the financial resources used for the acquisition and construction of major capital assets.

Agency Fund

A fund used by a government to account for resources held in a trustee capacity for individuals, private organizations, or other government units.

Governmental Entities

Organizations that operate on the government's behalf, including departments, agencies, and authorities, responsible for implementing policy and managing public sector resources.