Which of the Following Statements Is Most CORRECTσ

question 8

Multiple Choice

Which of the following statements is most CORRECTσ

• A) a defensive merger is one where the firm's managers decide to merge with another firm to avoid or lessen the possibility of being acquired through a hostile takeover.
• B) acquiring firms send a signal that their stock is undervalued if they choose to use stock to pay for the acquisition.
• C) cash payments are used in takeovers but never in mergers.
• D) managers often are fired in takeovers, but never in mergers.
• E) if a company that produces military equipment merges with a company that manages a chain of motels, this is an example of a horizontal merger.

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Definitions:

State Unemployment Taxes

Taxes paid by employers to fund the state's unemployment insurance program, providing financial assistance to workers who have lost their jobs.

Employee Payroll Deductions

Amounts withheld from an employee's salary for taxes, insurance, and other mandatory or voluntary contributions.

Federal Unemployment Taxes

Taxes paid by employers to the federal government to fund unemployment benefits and job service programs.

Insurance Pension Plans

Retirement plans that combine the benefits of insurance and savings, providing income after retirement through periodic premiums paid during a worker’s employment.