1. Industry Convergence M&As

A. are the type that usually produce the most gains for the companies involved.

B. typically occur early in the industry life cycle of the companies involved.

C. typically occur between companies in mature industries.

D. are highly risky because they involve the trying to blend companies operating in different industries.

E. typically involve mid-sized companies in high tech industries.

2. Which of the following is the best example of a Market Extension M&A?

A. The merger between Citicorp and Travelers

B. The AOL - Time Warner merger

C. Disney's acquisition of ABC

D. DuPont's acquisition of Conoco, an oil company

E. Whirlpool's acquisition of N. V. Phillips, a leading European appliance maker

3. The better-off test for evaluating an acquisition involves

A. assessing whether the move will make the company better off because it will produce a greater number of core competencies.

B. assessing whether the move will benefit shareholders due to gains in earnings per share and faster stock price appreciation.

C. assessing whether the move will make the company better off by improving its balance sheet strength and credit rating.

D. evaluating whether the move offers potential for the company's existing businesses and new businesses to perform better together under a single corporate umbrella.

E. assessing whether the move will make the company better off by spreading shareholder risks across a greater number of businesses and industries.

4. The three tests for judging whether a particular acquisition can create value for shareholders are

A. the attractiveness test, the cost-of-entry test, and the better-off test.

B. the attractiveness test, the better-off test, and the shareholder value test.

C. the resource fit test, the profitability test, and the shareholder value test.

D. the shareholder value test, the cost-of-entry test, and the beter-off test.

E. the strategic fit test, the competitive advantage test, and the better-off test.