Which one of the following statements is correct?
A) An increase in the earnings per share as a result of an acquisition will increase the price per share of the acquiring firm.
B) The price-earnings ratio will remain constant as a result of an acquisition which fails to create value.
C) If firm A acquires firm B then the number of shares in AB will equal the number of shares of A plus the number of shares of B.
D) If no value is created when firm A acquires firm B, then the total value of AB will equal the value of A plus the value of B.
E) Diversification is one of the greatest benefits derived from an acquisition.
Correct Answer:
Verified
Q44: Which one of the following statements is
Q50: Rosie's has 1,800 shares outstanding at a
Q51: Which of the following are reasons why
Q53: The value of a target firm to
Q54: The Floral Shoppe and Maggie's Flowers are
Q55: The Sweet Shoppe and Candy Land are
Q56: Which one of the following defensive tactics
Q58: The primary purpose of a flip-in provision
Q68: Moore Industries has agreed to be acquired
Q80: Sleep Tight is acquiring Restful Inns for
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents