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Question:36 - 27854% p8 G8 X; H G" ^- L/ H" ~3 T) A
Which of the following is NOT a possible consequence of takeover defenses? Takeover defenses:
9 z; R' _# G/ k: jA)
* m* p; Q5 J; P) `. q' R/ ^! zprovide managers greater job security.' [$ f# v# Y" H9 `
B)
# z* Z6 t8 g+ Omay start a bidding war for the firm’s shares.
8 O7 U7 r I! c+ S5 P8 F' ^4 cC)
( g0 g* y; C9 d f: cchange the firm’s legal status from public to private.
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. e0 n/ g! y: f7 F' mforce the acquirer to negotiate directly with the firm’s Board of Directors.
+ Q2 ~4 X1 k, N% O- eQuestion:37 - 27901
0 A r, k1 v) s3 R0 y3 P; DWhich of the following statements regarding internal capital markets is FALSE?" ^ C; _& D" W" K9 n
A)+ P/ f' s0 r# k1 a' |4 G. S1 ], X
Political obstacles are likely to exist in efficiently allocating resources.' B* [; R( r8 ~ {9 I
B)
" `/ s/ h) j3 `7 J6 u l ~Management can channel free cash flow from mature business lines to high growth ventures.
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The firm can credibly signal the quality of new ventures.$ e# T: T: z# x" p
D)
# s# S- q! i% n0 Q9 q9 o$ KThe firm can save money by not issuing securities in the capital markets.# Z. A: H0 s9 u6 ]9 G
0 E/ X$ y4 G# ?1 x4 ZQuestion:38 - 9865, V$ k2 u3 G# R' Q' ]
Overestimating the growth rate of a firm in using a valuation model would result in a value that is likely to be:& [& _) @# H6 n1 e9 h% [ z
A)
8 n/ t7 t! c U0 h- K8 ltoo low.
) }+ H/ d' }8 w& p( wB)
, ^1 ]1 f$ A7 W: b% K ]+ ccan't tell from this information.
$ }8 t' s# ?. R6 K2 _C)1 k% m# n. H4 m- H% e. \( f. r" @
too high.
( C" o$ f( |/ X* q8 UD)
/ r/ @9 n# B$ _: ~. dvery accurate.3 j, q% w! J/ M
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Question:39 - 98496 M* N4 P7 P, ~$ t+ d) h
The goal of asset valuation, based on the expected future cash flows of an asset, is to establish an asset’s:
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( }. m, I1 _6 f* a. [relative value.
: z+ p0 O% k3 H8 k/ g/ XB)- K2 x9 H" A/ _. g0 d
future value.
0 K+ G, w% |* E# E9 F0 Z3 |( jC)
8 z Z8 V+ Z" c( A( G0 J" Mintrinsic value.
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market value.
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# ^4 i9 [+ a8 bQuestion:40 - 9947% }6 [- e# M# B( x+ K
Roger Miller is the CEO of MetaCorp. MetaCorp is attempting to implement a strategic plan to establish a sustainable competitive advantage. The main thrust of the plan is to achieve a market share of at least 18 percent. Miller hires a strategy consultant to review the plan. The consultant concludes that MetaCorp’s strategic plan is inadequate. Which of the following is a likely reason for the consultant’s conclusion?6 M5 h5 n. m, W: d* X
A)
, O, p3 m# i6 Y/ g. m5 yAn 18 percent market share is sufficient to create a sustainable competitive advantage.
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An 18 percent market share is too large to create a sustainable competitive advantage.& X U/ A3 n+ P9 P6 ^( }& p
C)0 [9 N- Y4 [, Z5 I2 N2 ?6 B
Market share goals are not a competitive strategy.' n8 Q/ u1 t/ Z) b' A2 ?0 k+ F
D)7 M5 b! b- S% y% P- Q" g8 D, w
The market share goal must be considered in relation to the number of competitors./ y2 T; N- A5 f: ^7 c( d
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