A consolidation is deﬁned as a merger wherein:
A) One ﬁrm is completely absorbed by another ﬁrm.
B) One ﬁrm acquires the assets, but not the liabilities, of another ﬁrm.
C) Both the acquiring ﬁrm and the acquired ﬁrm cease to exist.
D) At least 80 percent of the common stock of one ﬁrm is acquired by another ﬁrm.
E) At least 51 percent of the common stock of one ﬁrm is acquired by another ﬁrm.

Question

Quizplus · Accepted Answer

In a consolidation, both the acquiring firm and the acquired firm cease to exist, and a new entity is formed.

A Consolidation Is Deﬁned as a Merger Wherein