If a Merger Creates Synergy, Then The

Multiple Choice

If a merger creates synergy, then the:

A) merger is classified as a taxable transaction.
B) acquiring firm's shareholders will receive a one-time cash payment.
C) equity of the target firm will be increased by the amount of the synergy.
D) value of the merged firm exceeds the combined value of the separate firms.
E) price paid by the acquiring firm will be reduced by the amount of that synergy.