The acquisition of a “cash-rich” company allows the acquiring company
A. to reap greater tax benefits.
B. to reduce leverage and to increase borrowing power.
C. to develop better managers.
D. to achieve economies of scale in some phase of the business.
Answer:B
The acquisition of a “cash-rich” company allows the acquiring company
A. to reap greater tax benefits. B. to reduce leverage and to increase borrowing power. C. to develop better managers. D. to achieve economies of scale in some phase of the business.