If the market for corporate control were efficient as a governance device, then only __________ would be targets for takeovers.
A) firms with unethical top executives
B) firms earning above-average returns
C) poorly performing firms
D) overvalued firms

Question

Quizplus · Accepted Answer

Poorly performing firms are typically targets for takeovers because they are seen as opportunities for improvement and value creation by new management.

If the Market for Corporate Control Were Efficient as a Governance