The price that a company has to pay to purchase another firm is
A) the book value.
B) the market value.
C) some premium over current market value.
D) some discount of current market value.

Question

Quizplus · Accepted Answer

When a company purchases another firm, it usually has to pay a premium over the current market value. This premium represents the value of the acquired firm's assets, brand, and other intangible factors that are not reflected in the current market value. Therefore, option C is the correct answer.

The Price That a Company Has to Pay to Purchase