Which of the Following Statements Regarding Poison Pills Is FALSE

question 39

Multiple Choice

Which of the following statements regarding poison pills is FALSE?

• A)Companies with poison pills are harder to take over,and when they are taken over,the premium that existing shareholders receive for their stock is higher.
• B)Because a poison pill increases the cost of a takeover,all else equal,a target company must be in better shape to justify the expense of waging a takeover battle.
• C)Poison pills also increase the bargaining power of the target firm when negotiating with the acquirer because poison pills make it difficult to complete the takeover without the cooperation of the target board.
• D)By adopting a poison pill,a company effectively entrenches its management by making it much more difficult for shareholders to replace bad managers,thereby potentially destroying value.

---

Definitions:

Male-Dominated Industries

Sectors of the economy where the workforce or leadership is predominantly male.

Formal Mentoring Programs

are structured initiatives within organizations that pair less experienced employees with more experienced colleagues to facilitate personal and professional growth.

ROPES

An acronym in the field of education and training that stands for Review, Overview, Presentation, Exercise, and Summary, a methodical approach to teaching and learning.

Job Performance

The level at which an employee executes their duties and responsibilities at work.