In a Merger The

question 70

Multiple Choice

In a merger the:

• A) legal status of both the acquiring firm and the target firm is terminated.
• B) acquiring firm retains its pre-merger legal status.
• C) acquiring firm acquires the assets, but not the liabilities, of the target firm.
• D) shareholders of the target firm have little, if any, say as to whether or not the merger occurs.
• E) target firm continues to exist but will be a wholly owned subsidiary of the acquiring firm.

---

Definitions:

WACC Adjustment

The process of modifying the Weighted Average Cost of Capital to reflect changes in the market or the firm's risk profile.

Financing Scenarios

Different strategies and options available for a business or individual to raise capital or fund operations.

Cost of Capital

The return a company is required to make on its investments to sustain its market value and appeal to investors.

Risk Level

The degree of uncertainty associated with the return on investment, characterizing the potential for financial loss or gain.