Which of the following is a benefit of merging two companies who both have optimal debt levels?Multiple choice question.risk reductiona smaller tax shieldlower debt capacityan increase in risk

Which of the following contributes to increasing debt capacity after a merger?Multiple select question.the target firm has a low debt levelrisk-averse managementthe target firm has a high debt levela merger can decrease the debt risk level

Which of the following is an advantage of merger?Question 8Select one:a.Economies of scaleb.Finance advantagesc.Business diversificationd.a,be.all of the above

In the coinsurance effect, Blank______.Multiple choice question.debt is riskier and less valuable than before a mergerthere are large net benefits to the firm as a wholebondholders gain and stockholders lose, assuming no synergystockholders of the acquiring firm are helped by the amount the bondholders lose

A firm can limit the Blank______ effect by retiring its debt before the merger announcement date and reissuing an equal amount of debt after the merger.Multiple choice question.reinsurancecoinsuranceuncertaintyhostile

Which of the following results of mergers is most likely to be in the interests of customers? Reduced uncertainty Economies of scale Diversification Increased market value