It generates a positive net present value to the shareholders of an acquiring firm.
<h3>Why Do Companies Merge With or Acquire Other Companies?</h3>
Mergers and acquisitions (M&As) are the acts of combining two or more companies or assets in order to stimulate growth, gain a competitive advantage, increase market share, or influence supply chains.
KEY LESSONS
- Mergers and acquisitions (M&As) are the acts of combining two or more companies or assets in order to stimulate growth, gain a competitive advantage, increase market share, or influence supply chains.
- A merger is the joining of two companies in which one of the companies ceases to exist after being absorbed by the other.
- A merger occurs when one company acquires a majority stake in the target company, which keeps its name and legal structure.
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Answer: Interest expense = $45500
Cash outflow = $45500
Explanation:
Based on the information that were given in the question, the amounts of interest expense and cash flows from operating activities, that will be reported in the financial statements for the year ending December 31, Year 1 will be calculated thus:
Interest expense = $700,000 × 6.50%
= $700,000 × 0.065
= $45500
The interest expense of $45500 will be reported on December 31, Year 1 in the income statement and will also be reported in the cash outflow as well. Therefore,
Interest expense = $45500
Cash outflow = $45500
Answer:
Inflation rate= 0.03 = 3%
Explanation:
Giving the following information:
Nominal interest rate= 0.05
Real interest rate= 0.02
<u>To calculate the inflation rate, we need to use the following formula:</u>
Real interest rate= nominal interest rate - inflation rate
Inflation rate= nominal interest rate - real interest rate
Inflation rate= 0.05 - 0.02
Inflation rate= 0.03 = 3%
Answer:
The correct answer is c. actual market outcomes provide a higher price than the efficient price of education.
Explanation:
In any country, there is a close positive correlation between a greater number of years of study and income, just as a higher degree of education is related to a lower incidence of poverty. In general, knowledge provides a great deal of benefits to its holders, so why might a government policy for investment in human capital be necessary? The answer could be that knowledge generates a series of “external benefits”, which are not always considered by people when making their decisions.
Economic activities generate costs and benefits, which can be private or external. In this way, whoever studies obtains a benefit for himself, for example a better salary, as explained above. That is the private benefit. But a series of external benefits are also generated, for example, the possibility of being better citizens, of improving the communication and performance of people in society, of generating new solutions to different human problems, among many others. Likewise, research and development activities lead to obtaining new knowledge. All these benefits are obtained thanks to preschool, primary, secondary, technical, university education, job training, among others.
Answer:
Answers are A , B and C
Explanation:
A : Transactions in short term debt instruments which are ranged less than twelve months (for example,commercial paper,treasury bills, govt bonds etc.,) and also marketable securities ( only specific marketable securities which are highly liquid and due within 3 months) takers place in the money market.
B : In order to raise finance in the capital markets, issuers typically require a high Equity securities represent an ownership claim to the assets of a company. A preferred share is a special type of security which has a fixed periodic and hence Capital markets are typically used for fixed assets, which company will use over several years.
C : Money Markets are short term markets, where funds are invested for a shorter time - usually one year or less.
