A Capital Structure Argument (That Leverage Increases Value)is Often Used

question 58

True/False

A capital structure argument (that leverage increases value)is often used to show that a large acquisition price premium is justified even though the target has little debt before the acquisition.

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Definitions:

Mass Customization

Mass customization is a manufacturing and marketing technique that combines the flexibility and personalization of custom-made products with the low unit costs associated with mass production.

Self-Service

A business model or service design that allows customers to perform services for themselves without direct assistance from employees.

Mass Service

A type of service operation characterized by serving a large number of customers with standardized services, often with little to no customization.

Service Factory

A business model that combines production and service provision, focusing on delivering manufactured goods along with value-added services.