The complete absorption of one company by another, where the acquiring firm retains its identity and the acquired firm ceases to exist, is called a _______.

		A. merger
		B. consolidation
		C. tender offer
		D. spinoff
		E. divestiture

Given the following information, what is the time value of a European call option? Stock price=$18, exercise price=$10, time to expiration=2 months, risk-free rate=10% continuously compounded, standard deviation=40% annually

		A. $7.29
		B. $8.00
		C. $8.17
		D. $8.85
		E. $9.68

A merger in which an entirely new firm is created, with both the acquired and acquiring firms ceasing to exist, is called a _______.

		A. divestiture
		B. consolidation
		C. tender offer
		D. spinoff

1. The acquisition of a firm in the same industry as the bidder is called a:

   		A. Conglomerate acquisition.
   		B. Forward acquisition.
   		C. Backward acquisition.
   		D. Horizontal acquisition.
   		E. Vertical acquisition.

The acquisition of a firm whose business is not related to that of the bidder is called a:

		A. Conglomerate acquisition.
		B. Forward acquisition.
		C. Backward acquisition.
		D. Horizontal acquisition.
		E. Vertical acquisition.