1. Which of the following is a defensive mechanism against unfriendly takeovers? a. Greenmail b. Poison Pill c. Both A and B d. Forward vertical integration e. All of these 2. Which of the following is company? NOT an advantage of stock acquisitions over asset acquisitions when acquinng a. Lower cost of acquisition. b. Faster and easier to complete. C. More straightforward and simple accounting after acquisition. d. Benefits of having two separate legal entities rather than one. 3. Which of the following is a possible method for the subsidiary to borrow money from the parent? a. The subsidiary issues bonds directly to the parent. b. The subsidiary issues bonds to outsiders and later the parent lends the subsidiary to redeem (i.e., call) the bonds. c. The subsidiary issues bonds to outsiders and later the parent purchases these bonds from outsiders d. All of these are possible methods for the subsidiary to borrow money from the parent. Which of the following is correct about intercompany leases (i.e., leases between the parent and the subsidiary)? a. The effect of the lease on the parent's and subsidiary's income is reversed (i.e., cancelled) by adjusting their respective income distribution schedules. b. None of these statements is correct. c. Only intercompany capital leases are reported in the consolidated financial statements, while intercompany operating leases are eliminated in the consolidation process. The most common form of intercompany leases involves a subsidiary (lessor) buying an asset and leasing it to the parent (lessee). d