On average,shareholders of the:
A)target firm benefit from mergers.
B)target firm benefit from cash mergers and incur losses in stock mergers.
C)acquiring firm benefit the most from a merger.
D)target firm suffer losses when a merger occurs.
E)both the acquiring and target firm incur losses when firms merge.

Question

Quizplus · Accepted Answer

On average, shareholders of the target firm tend to benefit from mergers. This is because the acquiring firm usually offers a premium price for the shares of the target firm, which results in a positive financial outcome for the shareholders of the target firm. However, it is worth noting that not all mergers result in positive outcomes for shareholders, and the specifics of each merger will affect the results.

On Average,shareholders of The