Cost/benefit analyses are tricky when evaluating the current status of an alliance or acquisition because:
A) The interdependence that is built makes it difficult to measure costs and benefits
B) Transfer pricing causes problems in understanding who did what
C) Transaction costs are affected by the agency tendencies of top-level managers
D) The firms may not care what the partnering firm is doing
E) There is no reason to be concerned with cost/benefit at this stage

Question

Quizplus · Accepted Answer

The interdependence created in alliances or acquisitions complicates the measurement of costs and benefits, as the outcomes are often intertwined and not easily attributable to individual entities.

Cost/benefit Analyses Are Tricky When Evaluating the Current Status of an Alliance