assume firm A acquired firm B. as a result the EPS of firm A increase by 10 perc
ID: 2616448 • Letter: A
Question
assume firm A acquired firm B. as a result the EPS of firm A increase by 10 percent. given this increase you know for certain that the ___.Value of B to A exceeded the value of B as a stand alone firm.
Acquisition provided diversification benefits
Purchase price was below market value
Total earnings divided by the total shares increased
Acquisition created synergy
assume firm A acquired firm B. as a result the EPS of firm A increase by 10 percent. given this increase you know for certain that the ___.
Value of B to A exceeded the value of B as a stand alone firm.
Acquisition provided diversification benefits
Purchase price was below market value
Total earnings divided by the total shares increased
Acquisition created synergy
assume firm A acquired firm B. as a result the EPS of firm A increase by 10 percent. given this increase you know for certain that the ___.
Value of B to A exceeded the value of B as a stand alone firm.
Acquisition provided diversification benefits
Purchase price was below market value
Total earnings divided by the total shares increased
Acquisition created synergy
Explanation / Answer
Option D is correct.
Total earnings divided by the total shares increased.
Combined earning divided by the total shares has increased therefore the EPS has increased. Synergy is created then the value would be increased.
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