The rational process by which acquiring firms evaluate target firms is
A) due diligence.
B) strategic analysis.
C) prospect screening.
D) meta-analysis.

Question

Quizplus · Accepted Answer

Due diligence is the process by which acquiring firms thoroughly evaluate a target firm before making a decision to acquire it. This includes analyzing financial statements, legal documents, and other important factors to ensure that the target firm is a good investment. Strategic analysis and prospect screening may be part of the due diligence process, but they are not the main process by which acquiring firms evaluate target firms. Meta-analysis, on the other hand, refers to a specific type of research methodology and is not relevant to the acquisition evaluation process.

The Rational Process by Which Acquiring Firms Evaluate Target Firms