Cash-Rich Firms Often Make Questionable Acquisitions,rather Than Pay Out the Cash

question 52

Multiple Choice

Cash-rich firms often make questionable acquisitions,rather than pay out the cash to shareholders.This:

• A) is because diversification is too costly for individuals.
• B) is an example of an agency problem.
• C) is because diversification eliminates inefficiencies.
• D) is an example of the bootstrap game.

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Definitions:

Unequal Place

Refers to spaces or regions marked by disparities in resources, opportunities, and treatment of individuals based on various socio-economic factors.

Argue Against

To present reasons or evidence contrary to an idea, theory, or proposal.

Nation States

Political entities consisting of a clearly defined territory and population that is politically organized under a sovereign government.

International Organizations

Entities established by treaties between governments for purposes of conducting activities and fostering cooperation among member countries across borders.