Question

TRUE or FALSE

1. Retiring long-term debt early to reduce total debt on the balance sheet will help managers defend against a hostile takeover.

2. That companies move into international operations can help them take advantage of lower production costs in regions where labor costs are relatively high.

Answer 1

1. Retiring long-term debt early to reduce total debt on the balance sheet will help managers defend against a hostile takeover. - FALSE

This statement is incorrect as an attempt to reduce the total debt will result in decreased equity and lesser capital to buy one's own shares, thus aiding the hostile takeover process

2. That companies move into international operations can help them take advantage of lower production costs in regions where labor costs are relatively high. - FALSE

A company moves to international operations to take advantage of lower production costs in regions where labor costs are relatively low. This is because as lobor costs gets lower, production costs decreases benefiting the company.