Synergy is defined as the:
A) Positive incremental net gain associated with the combination of two firms.
B) Entering into a new industry in search of profitable opportunities.
C) Economies of scale that relate to the average cost of goods produced.
D) Process of removing existing managers after a successful takeover.
E) Benefit of the lockup agreement.

Question

Quizplus · Accepted Answer

Synergy refers to the concept that the combined value and performance of two companies will be greater than the sum of the separate individual parts. This means that when two firms merge, the new entity can potentially generate more value than the two individual firms could on their own, due to efficiencies, new capabilities, or market power gained through the combination.

Synergy Is Defined as The