Because of hubris, managers of acquiring firms sometimes believe their valuation of a target firm is superior to the market's valuation. Under these circumstances, they often end up overpaying for the firm. True and False

Question

Quizplus · Accepted Answer

This statement is true. Hubris can lead managers to believe that they know better than the market and overvalue the target company, resulting in overpayment.

Because of Hubris, Managers of Acquiring Firms Sometimes Believe Their