Which of the following statements are correct? I. In a merger or acquisition, a

Question

Which of the following statements are correct?
I. In a merger or acquisition, a firm should be acquired if it generates a positive net present value to the shareholders of an acquiring firm.
II. Upon the announcement of an acquisition, bidding firms tend to earn small positive returns while target firms experience large gains.
III. Stock acquisitions and diversifying mergers typically provide the largest gains for bidding firms' shareholders.
IV. Anti-takeover provisions always entrench management and never have any beneficial effects.

Explanation / Answer

II. Upon the announcement of an acquisition, bidding firms tend to earn small positive returns while target firms experience large gains. only one is correct

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.