Question : Case Study 15:
DEF Corporation is a conglomerate planning to acquire a technology startup to enhance its digital capabilities.
Question :
DEF Corporation aims to acquire a technology startup for digital enhancement. Which market activity is associated with this scenario?
Option 1: Primary market
Option 2: Currency swap
Option 3: Mergers and acquisitions
Option 4: Treasury bill trading
Correct Answer: Mergers and acquisitions
Solution : The correct answer is (c) Mergers and acquisitions
The market activity associated with DEF Corporation's aim to acquire a technology startup for digital enhancement is mergers and acquisitions (M&A). Mergers and acquisitions involve the consolidation of companies through various financial transactions, such as acquisitions or takeovers. In this scenario, DEF Corporation intends to acquire a technology startup, which is a strategic move to enhance its digital capabilities. M&A activities are commonly utilized for this purpose, allowing companies to grow, diversify, or improve their competitive positioning by integrating the operations and technologies of another company into their own.
