Which of the Following Statements Is Most CORRECT

Multiple Choice

Which of the following statements is most CORRECT?

A) A conglomerate merger is one where a firm combines with another firm in the same industry.
B) Regulations in the United States prohibit acquiring firms from using common stock to purchase another firm.
C) Defensive mergers are designed to make a company less vulnerable to a takeover.
D) The equity residual method values a target firm by discounting residual cash flows at the acquiring firm's overall cost of capital reflecting the combined firm's post-merger capital structure.
E) A financial merger occurs when the operations of the firms involved are integrated in the hope of achieving synergistic benefits.