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A Common Procedure to Determine the Value of a Merger

question 8

Multiple Choice

A common procedure to determine the value of a merger candidate is to estimate the present value of discounted cash flows and the expected after-tax earnings attributable to the merger.This can be done on all of the following levels except:


Definitions:

Premiums

Payments made regularly to an insurance company in exchange for coverage, representing the cost of the insurance policy.

Co-insurance Clause

A provision in insurance policies requiring the policyholder to bear a portion of the loss by maintaining coverage of a specified percentage of the value of the property to receive full reimbursement.

Fireproof

The quality of being resistant to or capable of withstanding damage by fire.

Insured

A person or entity covered under an insurance policy, receiving financial protection or reimbursement against losses from an insurance company.

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