Which of the Following Statements Regarding 'Efficiency Gains' Is FALSE

question 37

Multiple Choice

Which of the following statements regarding 'efficiency gains' is FALSE?

• A)Although identifying poorly performing corporations is relatively easy, fixing them is another matter entirely.
• B)A chief executive of an inefficiently run corporation can be ousted by current shareholders voting to replace the board of directors, and in fact many ineffective managers are replaced in this way.
• C)A justification that acquirers cite for paying a premium for a target is efficiency gains, which are often achieved through an elimination of duplication.
• D)Takeovers relying on the improvement of target management are difficult to complete, and post-takeover resistance to change can be great. Thus not all inefficiently run organisations are necessarily more efficient following a takeover.

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