Firm a Has a Value of $100 Million and Firm

question 66

Multiple Choice

Firm A has a value of $100 million and Firm B has a value of $70 million. Merging the two would enable cost savings with a present value of $20 million. Firm A purchases Firm B for $75 million. What is the cost of this merger?

• A)$30 million
• B)$20 million
• C)$5 million
• D)$10 million

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Definitions:

Demand Characteristics

Cues in an experimental environment that suggest to participants what behavior is expected or desired by the researcher.

Obviously Correct

A term indicating that something is clearly right or true, leaving no room for doubt or debate.

Frequency Distributions

A statistical representation, often visual, that displays the number of occurrences of each distinct value of a variable.

Designated Categories

Predefined classifications or groups into which objects, individuals, or ideas are placed based on shared characteristics or attributes.