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Two Companies Are Competitors

Question 12

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Two companies are competitors. The following facts about the companies and their industry are significant.
a. Both firms use similar production, distribution, and sales techniques.
b. One firm is losing money, while the other is profitable.
c. There is a great deal of overhead in the business.
d. The industry is dominated by a single firm that's about as big as these two combined.
The two companies are considering a merger. State several arguments in favor of the combination.

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(a) Synergies may be available by elimin...

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