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Synergy in a merger refers to:
AThe accounting goodwill arising on consolidation
BValue created when combined firm exceeds sum of standalone values
CThe cash payment required to acquire the target
DThe interest rate saved by refinancing acquirer debt
Answer & Solution
Correct answer: B. Value created when combined firm exceeds sum of standalone values
1. Identify what the question asks: this concept maps to synergy (§4.1).
2. Apply the framework or formula relevant to the topic.
3. Eliminate distractors and arrive at the correct option (B).
_Source: ICAI BoS CA Final Paper 2, Ch 14 "Mergers Acquisitions and Corporate Restructuring"_
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