Question

The target firm determines its liquidation value and the present value of its relevant stand alone cash flows and selects the higher value. This is the target's Select one: a. maximum acceptable price b. minimum acceptable price c. neither A nor B

Answer 1

Minimum acceptable is the target's. As the target firm determines its liquidation value and the present value of its relevant stand alone cash flows.

What is liquidation value?

Liquidation value is the value which a firm get after the deduction of the assets and liability in the financial report. If the business will sold, the value which a firm gets after selling all of its assets is the liquidation value of the company.

Thus, option B is correct.

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