When the Ratio of Exchange in a Merger Is Equal

question 148

Multiple Choice

When the ratio of exchange in a merger is equal to one and both the acquiring and the target companies have the same premerger earnings per share, both the acquiring and the target companies have the same ________.

• A) debt ratio
• B) book value per share
• C) return on equity
• D) P/E ratio

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Definitions:

Societal Pressure

Refers to the influence exerted by society on individuals or groups to conform to certain norms, behaviors, or values.

More Powerful

Describes something that has a greater level of strength, influence, or capability compared to others.

Market Pressure

The influence on a company or industry resulting from changes in market conditions, such as customer demand, competition, or regulatory environment.

Globalization

The process by which businesses or other organizations develop international influence or start operating on an international scale.