1. Suppose a firm's financial statements indicate the following financial ratio values: X₁ = 20%, X₂ = 20%, X₃= -5%, X₄ = 50%, X₅ =1.35. It uses the Altman model: Z = 0.012(X₁) + 0.014(X₂) + 0.033(X₃) + 0.006(X₄) + 0.999(X₅). Using this model, is the firm likely to go bankrupt within one year?
2. What is bankruptcy?
3. Name the situations in which merger can be economically beneficial.
4. Briefly explain the term business liquidation.