Question 1

The ______________ of the merged company determines its success or failure.
A)Earning
B)Net profit
C)Capitalisation
D)Assets

Accepted Answer

The capitalisation of a merged company, which refers to the combination of its debt and equity, plays a crucial role in determining its success or failure. It affects the company's ability to finance operations, grow, and sustain itself in the long term.

Question 2

____________ is one of the valuation criteria for measuring the success of post merged company.
A)Financial Value
B)Market Value
C)Fair Market Value
D)Culture

Accepted Answer

C

Question 3

_____________ is an incredibly challenging process that senior executives are required to undertake in parallel to managing their core business operations.
A)Human Resource Management
B)Post-Merger Integration
C)General management integration
D)Product and service development.

Accepted Answer

Post-Merger Integration is a complex and challenging process that requires senior executives to blend the operations, cultures, and systems of two companies into one cohesive entity, all while continuing to manage their existing operations. This process involves integrating employees, processes, and technologies, which can be incredibly challenging and time-consuming.

Question 4

The earning performance of the merged company can be measured by return on total ___________ and total net worth.
A)Assets
B)liabilities
C)Share Capital
D)Market Value

Accepted Answer

The earning performance of a merged company is typically measured by return on total assets and total net worth because these metrics provide insights into how effectively the company is using its assets to generate earnings and how it is managing its overall financial health, respectively.

Question 5

Under section 72A of Income tax act, 1961 carry forward and setting off of accumulated losses and unabsorbed depreciation of the amalgamating company is allowed against the __________ profits of the amalgamated company in order to encourage revival of sick units.
A)Future
B)Present
C)Past
D)Market Value

Accepted Answer

Section 72A of the Income Tax Act, 1961, allows the carry forward and setting off of accumulated losses and unabsorbed depreciation of the amalgamating company against the future profits of the amalgamated company. This provision is aimed at encouraging the revival of sick units by allowing them to utilize their losses to reduce future tax liabilities.

Question 6

The merged firm would enjoy ___________ debt capacity because the combination of two or more firms provide greater stability to the earnings level.
A)Lower
B)Higher
C)Stable
D)Non of the above

Accepted Answer

The merged firm would have higher debt capacity because the combination of two or more firms typically results in greater stability in earnings, which in turn can support a larger amount of debt. Stability in earnings is viewed positively by creditors, as it suggests that the firm will be more capable of meeting its debt obligations.

Question 7

Merger/Amalgamation of two or more firms has been used as a dominant business strategy to seek rapid growth and ___________.
A)Stabilisation
B)Expansion
C)Diversification
D)Utilisation

Accepted Answer

The answer of Merger/Amalgamation of two or more firms has...

Question 8

The company which is subjected to _____________ will need to align its internal processes with that of the merged entity / acquired entity.
A)Restructuring
B)Post-Merger Integration
C)Share Capital
D)Non of the above

Accepted Answer

The answer of The company which is subjected to _____________...

Question 9

The earning performance of the merged company can be measured by return on total ___________ and return on net worth.
A)Assets
B)Liabilities
C)Share Capital
D)Financial Value

Accepted Answer

Return on total assets and return on net worth are common metrics used to measure a company's earning performance. Return on total assets evaluates how efficiently a company uses its assets to generate profit, while return on net worth (or equity) assesses how effectively a company uses the shareholders' equity to generate earnings.

Question 10

The ____________ improves the competitive position of the merged firm as it can command an increased market share.
A)Merger
B)Acquisition
C)Stabilisation
D)Expansion

Accepted Answer

Mergers often lead to an improved competitive position for the combined entity by increasing its market share, as it combines the strengths and resources of both companies.

Question 11

The earning performance of the merged company can be measured by return on total assets and return on___________.
A)Assets
B)Liabilities
C)Share Capital
D)Net Worth

Accepted Answer

Return on net worth measures the profitability of a company by showing how much profit a company generates with the money shareholders have invested.

Question 12

Merger/Amalgamation of two or more firms has been used as a dominant business strategy to seek rapid __________ and Diversification.
A)Stabilisation
B)Expansion
C)Utilisation
D)Growth

Accepted Answer

Growth is the correct answer because merger/amalgamation of two or more firms is used as a dominant business strategy to seek rapid growth and diversification.

Question 13

There are _______ sets of rules for a successful PMI.
A)20
B)15
C)10
D)5

Accepted Answer

The answer of There are _______ sets of rules for...

Question 14

The net result of realizing economics of scale would be an __________ in the cost of production.
A)Increase
B)Decrease
C)Stable
D)None of the above

Accepted Answer

The answer of The net result of realizing economics of...

Question 15

Modern markets always dictate __________ innovation and improvement on product and services.
A)Continuous
B)Stable
C)Increased
D)None of the above

Accepted Answer

Modern markets demand ongoing innovation and improvement in products and services to stay competitive, which is best described as "continuous."

Question 16

__________ involves the utilization of resources.
A)Management
B)Analysis
C)Culture
D)Net Profit

Accepted Answer

Management involves the utilization of resources, including human, financial, and material resources, to achieve organizational goals.

Question 17

The capitalisation of the ___________ company determines its success or failure.
A)Expansion
B)Net profit
C)Merged
D)Assets

Accepted Answer

The answer of The capitalisation of the ___________ company determines...

Question 18

Whenever the merged firm raises funds from the market through public issue of shares or debentures, it can ___________ the floating cost.
A)Reduce
B)Increase
C)Constant
D)None of the above.

Accepted Answer

When a merged firm raises funds from the market through public issues of shares or debentures, it can reduce the floating cost due to economies of scale and a potentially stronger financial position, making it more attractive to investors.

Question 19

Modern markets always dictate Continuous innovation and __________ on product and services.
A)Improvement
B)Stable
C)Increased
D)None of the above

Accepted Answer

Continuous innovation in modern markets is typically accompanied by improvement on products and services to meet changing consumer demands and stay competitive.

Question 20

The earning Performance of the merged cannot be measured by return on total share price and return on ________ worth.
A)Net
B)Average
C)Future
D)Higher

Accepted Answer

The correct term is "net worth," which refers to the total assets minus total liabilities of a company. Return on net worth is a measure of a company's profitability relative to shareholders' equity.

Quiz 7: Key Considerations in Mergers and Acquisitions

The ______________ of the merged company determines its success or failure.

____________ is one of the valuation criteria for measuring the success of post merged company.

_____________ is an incredibly challenging process that senior executives are required to undertake in parallel to managing their core business operations.

The earning performance of the merged company can be measured by return on total ___________ and total net worth.

Under section 72A of Income tax act, 1961 carry forward and setting off of accumulated losses and unabsorbed depreciation of the amalgamating company is allowed against the __________ profits of the amalgamated company in order to encourage revival of sick units.

The merged firm would enjoy ___________ debt capacity because the combination of two or more firms provide greater stability to the earnings level.

Merger/Amalgamation of two or more firms has been used as a dominant business strategy to seek rapid growth and ___________.

The company which is subjected to _____________ will need to align its internal processes with that of the merged entity / acquired entity.

The earning performance of the merged company can be measured by return on total ___________ and return on net worth.

The ____________ improves the competitive position of the merged firm as it can command an increased market share.

The earning performance of the merged company can be measured by return on total assets and return on___________.

Merger/Amalgamation of two or more firms has been used as a dominant business strategy to seek rapid __________ and Diversification.

There are _______ sets of rules for a successful PMI.

The net result of realizing economics of scale would be an __________ in the cost of production.

Modern markets always dictate __________ innovation and improvement on product and services.

__________ involves the utilization of resources.

The capitalisation of the ___________ company determines its success or failure.

Whenever the merged firm raises funds from the market through public issue of shares or debentures, it can ___________ the floating cost.

Modern markets always dictate Continuous innovation and __________ on product and services.

The earning Performance of the merged cannot be measured by return on total share price and return on ________ worth.