Which of the Following Statements Is FALSE

question 47

Multiple Choice

Which of the following statements is FALSE?

• A)All else being equal,larger firms,because they are more diversified,have an increased probability of bankruptcy.
• B)To justify a takeover based on operating losses,management would have to argue that the tax savings are over and above what the firm would save using carryback and carryforward provisions.
• C)It is possible to combine two companies with the result that the earnings per share of the merged company exceed the premerger earnings per share of either company,even when the merger itself creates no economic value.
• D)When an acquirer buys a private target,it provides the target's owners with a way to reduce their risk exposure by cashing out their investment in the private target and reinvesting in a diversified portfolio.

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Definitions:

Better Results

An improvement in outcomes or achievements compared to previous performances.

Chip In

To contribute something, often money, towards a common goal or pool of resources.

Diversity in Groups

The inclusion and integration of individuals with varying characteristics, such as race, gender, age, and cultural background, within a group or organization.

Homogenous Groups

Groups composed of members who are similar in terms of characteristics, beliefs, or backgrounds.