Finance

If one firm in a given industry declares bankruptcy, the market may lo

If one firm in a given industry declares bankruptcy, the market may lower the values of other firms in a given industry because the reveals new, negative information about the status of the industry as a whole. This phenomenon is called: a. the contagion effect. b. the intra-industry wealth transfer effect. c. irrational behavior. d. […]

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Date: September 19th, 2020

Contract devices explicitly designed to thwart a hostile takeover atte

Contract devices explicitly designed to thwart a hostile takeover attempt are called poison pills or shark repellents. Examples include all of the following EXCEPT: a. a shareholder rights plan that can be issued as dividends at management’s discretion. b. an event-triggered put provision in one of the firm’s debt contracts. c. a provision in the […]

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Date: September 19th, 2020

The purchasers in a buyout often obtain financial and strategic assist

The purchasers in a buyout often obtain financial and strategic assistance from a _ who, as a sponsor, usually finances the transaction with equity contributed by a number of investors and debt borrowed from several sources. a. buyout specialist. b. LBO intermediary c. finance company d. venture capital firm     ANSWER A

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Date: September 19th, 2020