Question

The result of a merger between two corporations is that:

a. only one corporation continues to exist.
b. both corporations continue to exist, but one is the parent and one is the subsidiary.
c. neither corporation continues to exist, but a new corporation is formed instead.
d. both corporations continue to exist, but one owns the assets of another.

Answer 1

In a corporate merger, two previously independent firms join to become a single entity, resulting in only one corporation continuing to exist. Acquisitions differ as the purchased firm may carry on under its previous name. Antitrust laws regulate such corporate activities to preserve market competition. Therefore correct option is A

Step-by-step explanation:

The result of a corporate merger is that only one corporation continues to exist. This process involves two formerly separate firms combining to become a single new entity. In contrast, an acquisition is when one firm purchases another and may result in the purchased firm continuing to operate under its former name, though under common ownership. Mergers can also be lateral, where two firms of similar sizes join forces. Antitrust laws can sometimes influence the outcomes of mergers and acquisitions, aiming to maintain active competition in the market by preventing or breaking up large firms into smaller competitors.