Landon Industries Is Considering a Merger with Lake Industries

question 170

Multiple Choice

Landon Industries is considering a merger with Lake Industries.Landon offers its employees competitive salaries and generous benefit packages,but salaries at Lake are below the industry average,and Lake's benefit packages is much lower than Landon's.Not surprisingly,the employees at Landon are concerned that a merger with Lake would cause their benefits to decline.The CEO of Landon thinks that the best way to overcome the employees' resistance to the merger is through education and communication,but the CEO of Lake wants to force all employees in the newly merged companies to accept the changes.If the following facts were known,which one would weaken the Lake CEO's argument?

• A) Several years ago,Lake merged with another company.
• B) Employees at Landon have a variety of concerns about the merger,not just the concern about reduced benefits.
• C) Management's credibilitiy is undermined if it attempts to overcome change by hiding the truth about the effects of the change.
• D) Landon's customers are loyal to the salespeople they deal with,but they have little loyalty to Landon as a company.
• E) Employees at Landon are paid more than the people at Lake who are doing the same kind of work.

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Definitions:

Public Exchanges

Marketplaces where stocks, bonds, and other securities are traded among investors.

Cash Discounts

Reductions in the amount due by a customer if payment is made within a specified period, used as an incentive for quick payment.

Cash Payments

Transactions in which cash is used to settle debts, purchase goods, or services at the time of the purchase.

Cash Short

A situation where the amount of cash on hand is less than what is recorded on the books, often indicative of errors or theft.