Firm A is attempting to acquire firm T but is uncertain about T’s value. It judges that the firm’s value under current management (call this vT) is in the range of $60 to $80 per share, with all values in between equally likely. A estimates that, under its own management, T will be worth vA = 1.5vT - 30. (vA is strictly greater than vT except when vT equals 60.) Firm A will make a price offer to purchase firm T, which T’s current management (knowing vT) will accept or reject. Show that all possible offers result in an expected loss for firm A, even though T is always worth more under A’s control than under T’s.