Around the announcement date of a merger or acquisition, abnormal returns to target firm shareholders during the last several decades have been
A) Trending down
B) Trending up
C) Unchanged
D) Doubling each decade
E) None of the above

Question

Quizplus · Accepted Answer

Historically, abnormal returns to target firm shareholders around the announcement date of a merger or acquisition have been trending down over the last several decades. This trend is attributed to various factors including market efficiency improvements, regulatory changes, and the increasing sophistication of investors.

Around the Announcement Date of a Merger or Acquisition, Abnormal