1.EXPLAIN WHY DIVERSIFICATION PER SE IS PROBABLY NOT A GOOD REASON FOR A MERGER. 2.DESCRIBE THE ADVANTAGES AND THE DISADVANTAGES OF A TAXABLE MERGER AS OPPOSED TO A TAX-FREE ESCHANGE.WHAT IS THE BASIC DETERMINANT OF A TAX STATUS IN A MERGER?WOULD AN LBO BE TAXABLE OR NON TAXABLE?EXPLAIN. 3.SUPPOSE A COMPANY IN WHICH YOU OWN STOCK HAS ATTRACTED TWO TAKEOVER OFFERS.WOULD IT EVER MAKE SENSE FOR YOUR COMPANY'S MANAGEMENT TO FAVOUR THE LOWER OFFER?DOES THE FORM OF PAYMENT AFFECT YOUR ANSWER AT ALL