Which of the following statements is CORRECT?

Takeovers are most likely to be attempted if the target firm's stock price is above its intrinsic value.

Well$-$designed bond covenants are useful for reducing potential conflicts between stockholders and

managers.

The bid price in a hostile takeover is generally above the price before the takeover attempt is announced,

because otherwise there would be no incentive for the stockholders to sell to the hostile bidder and the

takeover attempt would probably fail.

The efficiency of the U$.$S$.$ economy would probably be increased if hostile takeovers were absolutely

forbidden.

Stockholders in general would be better off if managers never disclosed favorable events and therefore

'caused the price of the firm's stock to sell at a price below its intrinsic value.