Which of the Following Statements Is False

question 25

Multiple Choice

Which of the following statements is false?

• A) In practice, most acquirers pay a substantial acquisition premium, which is the percentage difference between the acquisition price and the premerger price of the target firm.
• B) When a bid is announced, the target shareholders enjoy a gain of 16% on average in their stock price.
• C) In Canadian provinces, the law requires that when existing shareholders of a target firm are forced to sell their shares, they receive the market price for their shares. In most cases, this concept is interpreted as the value inclusive of any value that arises because of the merger itself.
• D) A bidder is unlikely to acquire a target company for less than its current market value.

---

Definitions:

Data

Facts and statistics collected together for reference or analysis.

Recommendations

Suggestions or advice given based on analysis or experience, intended to guide decisions or actions.

Purpose Statement

A declaration made by an individual or organization that outlines their intentions, goals, or objectives, providing a clear direction for actions.

Problem Statement

A brief explanation of a problem that needs solving or a situation that requires enhancement.