Which of the Following Is an Advantage of Acquisitions as a Means

question 69

Multiple Choice

Which of the following is an advantage of acquisitions as a means of entering foreign markets?

• A) Acquiring firms often underpay for the assets of the acquired firm.
• B) It enables firms to preempt their competitors.
• C) After an acquisition, many acquired companies face increased recruitments.
• D) Integrating the operations of the acquired and acquiring entities takes a very short time.
• E) Most acquisitions are successful due to adequate pre-acquisition screening.

---

Definitions:

Securities

Assets indicating an equity share in a publicly-listed firm (stock), a lending arrangement with a corporation or government (bond), or ownership rights via options.

Agency Problem

A conflict of interest between the principals, such as shareholders, and the agents managing the company, like executives or managers.

Empire Building

A strategy where a company's executives expand their organization's size and operations, often to increase power and control, regardless of shareholder benefit.

Corporate Jets

Private aircraft owned or leased by corporations for the purpose of transporting executives and employees, often to support business operations more efficiently.