Acquiring Corp Agrees to Buy 100% of the Outstanding Shares

question 42

Multiple Choice

Acquiring Corp agrees to buy 100% of the outstanding shares of Target Corp in a share for share exchange.How would Acquiring Corp determine how many new share of its
Stock it would have to issue?

• A) Multiply the purchase price premium paid for Target's stock by the number of shares of target stock outstanding.
• B) Multiply the share exchange ratio by the number of Acquirer shares outstanding.
• C) Add the number of Acquirer and Target shares outstanding
• D) Multiply the share exchange ratio by the number of Target shares outstanding.
• E) Divide the share exchange ratio by the purchase price premium

Identify the short-run and long-run effects of fluctuations in aggregate demand on the economy.

Differentiate between the short-term and long-term impacts of economic policies on aggregate supply.

Analyze the effectiveness of monetary and fiscal policies in response to recessions and economic downswings.

Understand how changes in money holdings affect interest rates.

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Definitions:

Standard Deviations

A statistical measure that quantifies the dispersion or variance of a set of data points from their average, widely used in the finance sector to gauge the volatility of investment returns.

Systematic Risk

The overall market risk that cannot be diversified away by holding a wide range of asset classes.

Market Risk

The risk of losses in investments due to factors that affect the overall performance of the financial markets.

Nondiversifiable Risk

Risk factors common to the whole economy; also called market risk or systematic risk.