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Which of the Following Is Generally a Way That LBOs

Question 12

Multiple Choice

Which of the following is generally a way that LBOs can help a firm realize its potential value?


A) The synergies created allow for cost savings
B) The transaction reduces the disparity between a firm's actual and potential share price
C) The acquisition reduces the likelihood of competition in the industry
D) The transaction requires debt repayment with future free cash flow leaving management no discretion over the investment of these funds
E) The buyout gives an opportunity to adjust the management structure and makeup

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