Jarrell and Poulsen (1989)provide Explanations for the Negligible Wealth Effects

question 27

Multiple Choice

Jarrell and Poulsen (1989) provide explanations for the negligible wealth effects for acquiring-company shareholders.With regards to these explanations,which of the following statements is false?

• A)The expected gains from a known strategy of growth through acquisition may already be reflected in the company's share price.
• B)The positive effect of the information related to the financing of the takeover may be offset by the negative signal made by a share-exchange offer.
• C)Since acquiring firms are much larger than targets,the gain is small relative to the acquiring company's total value.
• D)None of the given options.

---

Definitions:

Data Redundancy

The duplication of data in multiple places within a database or information storage system, often to increase reliability or improve performance.

Normalization

The process of organizing the fields and tables of a database to minimize redundancy and dependency.

Exporting

The act of sending goods or services to another country for sale or trade.

Artificial Intelligence

The simulation of human intelligence in machines that are programmed to think like humans and mimic their actions.