Factors that are most likely to contribute to the magnitude of premiums paid to LBO target firm shareholders are

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Tax benefits, improved operating efficiency, and improved decision making are all factors that can contribute to the magnitude of premiums paid to LBO target firm shareholders. Tax benefits can result from the use of debt financing in the LBO, while improved operating efficiency and decision making can result from the changes made by the private equity firm after the acquisition. Therefore, all three factors (A, B, and C) are likely to contribute to higher premiums paid to LBO target firm shareholders.

Factors That Are Most Likely to Contribute to the Magnitude