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

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Definitions:

Sequential Processing

The cognitive process of understanding and organizing information in a specific, linear order.

Parallel Processing

The ability of the brain to simultaneously process incoming stimuli of differing quality, a cornerstone of nearly all cognitive functions.

Dual-Processing System

The concept in psychology that suggests there are two different systems in the brain for processing information: one that is fast, automatic, and nonconscious, and another that is slower, more deliberate, and conscious.

Circadian Rhythm

The natural, internal process that regulates the sleep-wake cycle and repeats on each rotation of the Earth roughly every 24 hours.