What financial outcome might arise from a takeover?

A takeover can lead to a reduced risk of failure for the acquiring business primarily because it allows the acquirer to expand its market share, enhance its product offerings, and benefit from economies of scale. By acquiring another company, the acquiring firm can diversify its investments, which spreads the risk associated with relying on a single operation. Additionally, the acquisition can provide access to new technologies or expertise that may strengthen the overall business and make it more competitive in the marketplace.

In contrast, while the other options may seem appealing, they do not accurately reflect the typical financial outcomes of a takeover. Increased job opportunities in the local area may not occur if the acquisition leads to duplication of roles or operational consolidations. Lower customer prices due to increased competition is also less likely, as a takeover often results in reduced competition if one company takes over another. Lastly, the immediate financial gains for the acquired business may not be guaranteed; the shareholders of the acquired company may benefit financially, but the broader risks associate with integration and potential restructuring can overshadow short-term financial gains.