If the tangible book value of a firm significantly exceeds its market value for an extended period of time,it can become an attractive takeover target.

Question

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When the tangible book value of a firm significantly exceeds its market value for an extended period of time, it means that the assets owned by the company are undervalued in the market. This undervaluation can attract potential buyers who see an opportunity to acquire the assets at a lower price than they are worth. Therefore, the firm becomes an attractive takeover target.

If the Tangible Book Value of a Firm Significantly Exceeds